Send to a friend

News

Rising ‘Sale in Execution’ Notices in South Africa Means Further Bargains for Property Investors - 15 October 2010

South African homeowners are desperate to sell, according to experts, creating great investment opportunities for overseas property buyers.

Many distressed-sale properties are being sold for 30 to 50 percent below their values, say real estate insiders. Banks are also handing out an unprecedented number of “sale-in-execution” notices to homeowners, which is one step away from a full repossession. Last year about 30,000 sale-in-execution notices were delivered.

The year-on-year price growth for homes in South Africa has also been on a steady decline. September’s growth from a year prior was 2.9 percent, whereas August’s year-on-year growth was 5.4 percent and July’s was nearly double at 10.1 percent.

Property experts say that the reason for the month-on-month declines has much to do with the market picking up in the latter part of last year, making the ratios between then and this last half of 2010 seem smaller in comparison to those of early 2009, when the market was sluggish, and early 2010, when it was well rebounding.

Experts are expecting more price declines in early 2011, especially with so many distressed homes ready to go on the market. However, prices are likely to pick back up by the mid to end of the year.

It should also be noted that price growth is still price growth, which many experts say could make these next six months a great window to invest in South African property. Banks may not be not as lenient as they once were, offering 100 percent loans on property values, but it is still common to find South African banks willing loan up 90 percent of a property’s price.

 


Browse our articles written by leading industry experts:

Overseas Property Buying Guides

UK Property Guides

Gardens and Interiors

Cosmetic Surgery Fact Sheets

Looking Good Guides

Money

Business

Community

Travel