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Chief Executive of real estate giant Pam Golding Properties, Andrew Golding, told BizNews Power Hour host Alec Hogg about the increase in purchases of second properties by consumers. ‘Post lockdown, the market has taken all of us by surprise. We were expecting there to be some pent up demand and then the market would basically represent what was happening pre-Covid – but that certainly hasn’t been the case’, says Golding. – Jarryd Neves
Andrew Golding on the increase of second homes being purchased in South Africa:
Certainly, post-lockdown, the market has has taken all of us by surprise. I think we were expecting some pent up demand (post-lockdown) and then the market would basically represent what was happening, pre-Covid. But that certainly hasn’t been the case. I think [it’s] fuelled by interest rates primarily, that has underpinned the middle and lower end of the market. Then later on in the year – towards the end – we started to see the top end of the market begin to move.
There’s been no question that the emergence of these so-called ‘Zoom towns’ has buoyed the second home market or the traditional second home market, where people have taken a view that they can work and live from anywhere – and therefore have made different lifestyle choices to those that they might have made before.
Andrew Golding on the ‘semigration’ trend:
I think we’ve seen the so-called semigration trend which, again, was present in some shape or form before Covid. It then quietened down towards the beginning of last year, and has definitely picked up again. But I think people are definitely making different lifestyle choices and deciding to live where they want to and then commute back to work. That is a trend that we’ve seen right across the country.
Andrew Golding on the price correction within the property market:
I think there was a general price correction, which was due in the market – certainly in the Western Cape, and we saw that. We saw opportunistic buyers cashing in at the beginning of the post-lockdown period. We saw some sellers in distress. As a consequence of that, there was a significant deal flow. As time has gone on, we’ve started to see more of a balance between buyers and sellers and certainly much less of that opportunistic buying. Our expectation is that prices are going to start to move again. House price growth has been very muted for the last couple of years, but it may be that this is the start of it moving again in a more significant, positive direction.
Steven Nathan on the ‘semigration’ trend:
The big structural change is that you don’t have to be in office all the time or perhaps, at all. I think what’s also been really interesting as a business owner – when you speak to your employees – you realise that some of them are commuting two hours each way – and you never really thought of that. The flexibility, affordability and quality of lifestyle means that people are going to be reassessing this. Also, you can probably get more bang for your buck.
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