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No property bubble

24 February 2005

Although the South African house prices have risen at a faster rate than the early 1980s, the Treasury in its Budget review does not see a bubble developing despite speculative activity in some parts of the market. The growth has been underpinned by a significant reduction in interest rates, growing real disposable income supported by net employment creation, and the economic empowerment of the previously disadvantaged.

Article on Finance24

Herschel Jawitz, CE of Jawitz Properties, said that this is the first budget in which Trevor Manuel has acknowledged the strong growth in the residential property market. However, he feels that the increase in the thresholds for transfer duty has failed to meet the expectations of the property sector, and has perhaps "passed up an opportunity to take a bold step, especially given the significantly higher collections from transfer duties over the last year".

Article on Moneyweb

Dr Andrew Golding, CE of the Pam Golding Property Group, commended the Minister for his continued emphasis on creating a stable and sound economic environment in South Africa. He also noted his attempts to encourage investment in housing and community infrastructure - especially at grassroots level, with the raising of the transfer duty threshold and indication of his intent to make home ownership more accessible.

Article on Moneyweb

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