Johannesburg – Financial services giant First National Bank (FNB) has tipped the Western Cape to be the prime region for the recovery of the property sector next year. John Loos, a property strategist at FNB, said that he expects the property vacancy rate, forecast at 8% for this year, to jump to 11% next year and 13% in 2022.
“We are of the opinion that the Western Cape has the strongest structural economic characteristics of the country’s big three economic provinces. It has built up a relatively strong government at provincial and local government levels, and is a modern services-dominated economy,” Loos said.
“It is perceived as a lifestyle province, which has attracted a strong semi-gration of skilled and affluent households, supporting its growth potential. It has thus been one of the stronger- performing economic and property regions… the Western Cape’s residential and commercial markets both have a higher percentage of tenants in good standing than Gauteng and KZN.”
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Izak Odendaal, an investment strategist at Old Mutual Wealth, said that putting together a picture of the property market is a bit trickier but that there are three economic trends pulling the housing market in different directions. He cited the rise in the number of people working from home, loss of more than a million jobs and the sharp decline in interest rates.
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