Undoubtedly 2023 was challenging, both for the economy as well as the property market, and 2024 looks equally challenging, but that doesn't mean there aren’t opportunities to be found in the year ahead.
Reflecting on the year that was, Regional Director and CEO of RE/MAX of Southern Africa, Adrian Goslett, said challenging as the past year was, the company had made enormous strides.
“Despite the high interest rate and all the other economic factors, our network grew by over 250 agents in 2023, which was probably one of the toughest years we, as an industry have faced in the last 10 years or so,” he noted.
Goslett added that the RE/MAX SA network also opened 20 new franchise locations around the country.
“While the industry languished at a 25-30% drop in sales, RE/MAX outperformed that by twice as much. There is no doubt that 2023 was tough, but the RE/MAX SA network worked hard for their clients to ensure that properties were sold timeously, and at fair market value.” he said.
Goslett expects 2024 to be another challenging year for the property market, and real estate agents would have to continue to work hard to close successful sales.
“While I am hopeful that there won’t be any further hikes, interest rates are likely to remain high over the course of the year. Many economists predict that interest rates will hold steady for the first half of 2024 and only expect to see a few interest rate cuts from the second half of 2024.”
He predicted that affordability will continue to be an issue in the year ahead, which means that the buyer pool was likely to remain smaller than usual.
“Sellers will need to listen to the advice of their chosen real estate professional and price the home fairly to attract a buyer in 2024.”
However, Goslett also highlighted that each suburb would have its own unique trend as property in some areas were in more demand than others.
“I predict that the semigration trend to the Western Cape and other coastal suburbs will remain strong in 2024. Sellers in these areas are likely to be able to attract higher sale prices than the sellers who are situated in the inland regions,” he said.
SA’s leading bond originator, BetterBond, shared some of these sentiments, and predicted that in 2024, there will be sustained semigration trends, and continued urbanisation creating higher demand for housing in cities and exerting pressure on service delivery in popular metros, like the City of Cape Town.
Tired of a lack of service delivery across the country, homeowners are also likely to continue investing in back-up power and water solutions. Goslett suggested that this was something sellers should bear in mind.
“Homes with off-the-grid features are becoming increasingly popular among buyers. If you are struggling to sell, investing in these types of features in 2024 might help attract more attention from buyers,” he said.
BetterBond also predicted that because of the tough economic conditions, the trend towards communal homebuying (where multiple people pool their financial resources to share the cost of homeownership) will continue to be strong in the year ahead.
“Pooling resources can be a great way to make homeownership more affordable – just be sure that whoever you partner with is reliable, as you will still be held liable for the repayments if your co-owner is unable to pay their half of the bill,” Goslett warned.
“While we anticipate continued growth in certain regions, largely owing to semi-gration and development trends, challenges such as affordability, geopolitical uncertainty, and the broader economic landscape must not be overlooked.
“Thankfully, the local housing market has proven to be resilient and adaptable. Ultimately, the 2024 South African housing market holds both opportunities and challenges. My advice for those who hope to spot the opportunities is to remain well informed and adaptable regarding your real estate needs in the year ahead, and to partner with a trusted real estate professional who can help you navigate through what promises to be an evolving landscape,” Goslett concluded.