After a dismal three year period, the South African property market finally seems poised for an upswing, according to the latest statistics released by ooba, South Africa’s leading home loan originator, which show that the recovery in the residential property market accelerated in February and looked set to continue this upswing. February was also the ninth consecutive month of positive house price growth, which signifies that the recovery in property prices continues to gather momentum.

However, this strong positive sentiment in the residential market may be short-lived due to ANC Youth League leader Julius Malema’s recent controversial utterances and the brutal slaying of AWB leader, Eugene Terre’blance, over the weekend.
According to First National Bank’s property market analytics division, Malema’s controversial utterances do not bode well for the country’s residential property sector, adding that Malema is placing the sector at risk by boosting emigration selling. FNB Home Loans strategist John Loos said in a report that recent political developments in the form of the ‘hate speech’ issues rearing its ugly head pose risks for sentiment.

An emigration selling surge in 2008 (during the Eskom crisis and after the ANC’s Polokwane congress in 2007) saw an oversupply of property on the market at the time, and the situation is only now beginning to stabilize. However, it seems that the recent welcome recovery may well be short lived, despite mortgage rates being at their lowest in three decades.
“The reality is that events that stir up a lot of hype do have the potential to dampen sentiment in some of the country’s major residential markets,” said Loos.
A lot now depends on government’s swift reaction and also what their response to the situation will be. Let us hope that the powers that be are, for once, able to look forward and, in doing so, reign in a petulant, egocentric politician who seems hell bent on destroying all that has been achieved since 1994.