Interpreting Market Trends 2007-2022
Category Property News
When making the decision to sell or purchase property, one should always ensure that you have a good understanding of the present market conditions. We have created a high level overview of past and projected price adjustments for the Southern Suburbs of Cape Town for 2007-2022, based on sales trends (prices and volumes) across one full property cycle (2009-2018).
The inference rationale is as follows:
2007 - 2008 Property prices peaked at the end of 2007 (Global Recession) after approximately 5 years of excellent growth.
2008 - 2012 Predominantly zero to little property price growth in the 4 years that followed the Global Crash.
2012 - 2017 Phenomenal price growth, with many areas experiencing 10-20% growth per annum. Sales volumes (in many areas) peaked in 2016.
2017 - 2018 Continued price growth, but volumes decline (YoY 2016 vs. 2017). Peak of growth cycle reached in Nov 2017.
2018 - 2019 Property prices start to decline. South Africa slips into a technical recession following two consecutive quarters of negative growth in Q1 and Q2 of 2018. Sales volumes continue to drop across most parts of the Southern Suburbs, with house prices declining by an average 15% between Nov 2017 - Nov 2018.
2019 - 2020 Predictions that the property market has not yet bottomed out, but will do so in the 2019 calendar year. This equates to further (but slower) property price reductions.
2020 - 2021 Property market to start recovering once the sensationalism of the national elections has passed. Property prices to increase at a higher rate than that of the decline of 2018-2019; based on historic property cycle up swings.
2021 - 2022 Increased rate of property price growth, which per the graph would, for the first time in 3 years, offer higher property values than 2018 (taking an average inflation rate of 5.8% into account [2008-2017; Stats SA]).
One could argue both sides for the current market being a great or terrible time to move - it all depends on when and where you plan to move to. If you are currently on the fence, chat to one of our Property Consultants about your plans, and we will do our best to advise you accordingly [firstname.lastname@example.org; 0217023203].
Author: Matthew Alberts