Property Trends in 2016
Category Market News
Reporter: Trends come and go, and with the property market, it's no different. The trick is to stay up-to-date with the latest trends and know how to approach them. The South African landscape is changing. Many more people are moving towards the city in the hope of finding employment. How does this affect the property market?
Simon Bray: You're a 100% right. I think South Africa still very much clusters in an emerging economy and one of the key characteristics of an emerging economy is how many people are still moving into urban areas. Urban areas are developing really rapidly - areas like Johannesburg, the CBD in Cape Town, CBDs in Eastern Cape like East London and PE - so these are really blossoming and growing areas. It changes the property needs and the property requirements for people, so you see a lot of apartments and high-density type developments going in.
What types of property are showing the most growth?
With these expanding urban communities, you're seeing a lot of these sectional type or mixed-use developments coming in. What that really means is people want to live, work, and play in the same areas. Traditionally, suburbs were where you lived, and then you'd go into locations like shopping malls or something to have a good time, whereas now you're seeing that the density of the cities and how many people are living there, the traffic flow problems, cause people to want to live, work, and have a good time right in the same neighbourhood.
A lot of the times we see trends internationally, and we tend to copy that. Is that happening in the world of property as well?
I think it is. One of the key trends we're seeing overseas is an aging population. An aging population means more retirement aged people, and in South Africa we're starting to see that. You're seeing the traditional home-owning market - guys that have had the traditional big South African house with a lovely big garden - wanting to downsize. I think 2016 is certainly going to be a year we see more retirement-focused developments popping up.
I think what I love about South Africa is that we're intending to go green, and we're becoming more eco-friendly. Is that happening with regards to the property market too?
Oh, absolutely. I'm most excited about this because I think in South Africa, finally, 2016 is going to be the breakout year for sustainable development. I think that's really exciting. Property has been under pressure for a long time with energy costs - you've got Eskom pushing the price of electricity up on a regular basis, but this year we've seen the drought as well. People are thinking about water - how they conserve it, how they use it in their homes - and all of that is putting the focus on sustainable development. In fact, I'm doing a renovation now, and the first thing you're thinking about is solar geysers, and grey water tanks, and rainwater tanks. It's exciting to see us thinking like that, and I think that's going to be a trend this year. 2016 is certainly going to see a lot more eco-focused property development.
In terms of price growth, which areas do you think have the potential for the best growth at the moment?
Price growth across the market is going to be slow this year. The economy's not growing at a rapid pace. We've got a lot of challenges and pressures on affordability, but I think there are going to be pockets that perform really well, and it's going to be those areas that meet the demands. So guys that have got mixed-use developments with high density near work locations are going to be in demand, and, of course, an end of the market that's really going to thrive is the buy-to-let market. You're going to see rentals go up quite a lot during the course of 2016, and that's going to be a great opportunity for investors to get involved and supply those investment apartments.
Article Sourced from Private Property website
Author: Private Property Blog
