The FNB House Price Index is at 6.4 % August 2013 for the greater Gauteng. The House Price Index has reflected a growth of 10-15% y/y for July 2013 in Pretoria East, depending on the type of property. The current repo rate is at 5% and prime rate at 8.5%. This is a good time to invest in property in Pretoria East. One of the reasons for this is the development taking place in the East of Pretoria.
When there is development taking place in any suburb it is a good indication that investors have confidence in the suburb or area.
When looking at the major construction work being undertaken in and around Menlyn, Pretoria East
you will understand that there is a definite sentiment of investor confidence, such projects would not occur if there is no confidence, as landlords need to fill the buildings assuring their income investment and in turn the tenants need some form of assurance that they would have a clientèle to generate their income and rent.
It is not a strong market overall considering the inflation rate but where there is positive growth it is always a good indication of the investment prospects and returns on your investment.
The trend seen in previous years was what was known as a seller’s market which led to overinflated property prices which in turn affected the realistic value of property. The demand for property has not decreased as much as is perceived as a result of the new credit act that was passed in 2007. Speculative investment has not been as widespread as in previous years which has brought property prices into a more realistic value.
The benefit of these realistic prices is reflected in a more constant market. To effect a sale of a property will now take in the region of 17 weeks.
Statistics supplied by John Loos from FNB Property Strategist and T Swanepoel Property Analyst with FNB.