CAPE TOWN - Absa’s Homeowner Sentiment Index was somewhat down in the third quarter compared with the second three months of 2019, in spite of a cut in lending rates in late July and a rebound in economic growth in the second quarter after a contraction in the first quarter, Absa Home Loans property analyst Jacques du Toit said yesterday.
The Homeowner Sentiment Index (HSI) score, which reflects the percentage of survey respondents with positive sentiment regarding residential property market conditions in the country, tapered to 75 percent in the third quarter from 77 percent in the second quarter. Sentiment level in the HSI sub-indices were mixed, indicating consumers were not overly positive nor overly negative about property market conditions in the third quarter.
Positive property-buying sentiment was unchanged at 69 percent. Positive sentiment towards selling property fell to 37 percent from 39 percent in the second quarter and 40 percent in the first quarter.
The level of positive sentiment for property as an investment was 81 percent, slightly down from 82 percent in the second quarter.
Factors that affected sentiment included the weak economy, the state of consumer finances, broad political and policy aspects and consumer confidence.
Low economic growth of less than 1 percent in 2019, with only a small improvement anticipated in 2020, inflation forecast to rise to 5 percent next year, a weakening rand, upward pressure on fuel and electricity prices and steady interest rates were factors likely to continue to drive property market sentiment for the rest of the year and in 2020, said Du Toit.