Residential Outlook Upbeat for 2025, Market Set to Rerate, Says Seeff
The outlook for the residential property market is upbeat for the 2025-year, says Samuel Seeff, chairman of the Seeff Property Group.
With the interest rate now down by 50 basis points, coupled with improved economic sentiment, the continued absence of loadshedding, and a reducing inflation rate, we could potentially see further rate cuts in the early part of the year.
On the back of this, Seeff expects the market to rerate in 2025 with two scenarios unfolding that would lead to higher property price and value increases. The first would be inland areas such as Gauteng, Mpumalanga, and Limpopo, but also coastal areas such as Gqeberha. These markets have mostly been subdued with benign to no growth scenarios for many months and years in some instances, and could start turning next year.
Most of these areas sit with surplus stock. He says the increased buyer activity will drive higher sales volumes, and once stock levels start depleting, prices and property values could start rising more meaningfully again.
The second scenario relates to regions where we have continued to see reasonable price growth due to sustained sales activity. This is essentially the Western Cape in particular, where we have seen stock levels come down quite significantly over the last few months. Here, he says, we could see price increases significantly outstrip inflation next year with growth rates upwards of 10% to 15% to 20%, depending on the area.
Seeff says inland and other areas with fairly high stock levels, still offer good buying conditions. Buyers who act now could potentially find a good deal in the market, but if they wait until further interest rate cuts, they may risk having to buy at higher prices.
Ultimately, the precursor to doing well in property is to buy low. Nobody rings a bell and announces that the market is now favourable, but Seeff says we can now see that the market has bottomed out, and is set to take the next upswing. Flat market conditions enable buyers to purchase property at a low value given the flat price growth, especially in the inland areas, but also the Eastern Cape and parts of KZN.
Property is a long-term investment, and an excellent wealth creator. The ability to buy at the bottom of the property cycle means you start on a good footing, and can potentially benefit from long-term financial gains once the market recovers, and property values rise again.
In terms of the Seeff Property Group performance for the year, Seeff says it is ending its 60th year on a high note with turnover up year-on-year by about 12% and is set to end on the highest gross sales turnover in the group’s history.
