FNB expects real home prices to fall yet again in 2019

From a buyer’s point of view, it [the market in 2018] wasn’t difficult!

John Loos, FNB

What can we expect from South Africa’s residential property market in 2019?

Ray White (in for Bruce Whitfield on The Money Show) interviewed John Loos, a property economist at FNB.

The bank expects home prices to rise by 3.7% in 2019.

Considering the latest available inflation rate (5.2%); it represents a real decline of about 1.5%.

Listen to the interview in the audio below (and scroll down for more quotes from it).

More of the same [his expectation for 2019]… mediocre to poor economic growth looks likely… it won’t strengthen the demand for property any time soon…

John Loos, FNB

You should be able to take a few percentage points worth of interest rate hikes… [also take into account] unexpected maintenance costs… tariffs rising faster than inflation… you’ve got to buy well within your means…

John Loos, FNB

I can’t say it isn’t a good investment… but you need to tread with caution… if you’re buying to let; tenants are coming under pressure.

John Loos, FNB

There’s no big excitement anywhere. Cape Town has slowed down after a few good years… The challenge in Cape Town… is to find affordable stuff not far from the City Bowl…

John Loos, FNB

Enclave living… is becoming more popular [in Johannesburg]… it’s not a healthy development…

John Loos, FNB

Building activity is not strong… [but] the number of formal homes is still growing…

John Loos, FNB

Certainly… it’s becoming much more of a buyers’ market… it’s not an extreme buyers’ market…

John Loos, FNB

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