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www.thevillagenews.co.za
3 June 2020
MY HOME
The time for decision-making and change is now By Stephen de Stadler Managing Director Fine & Country Hermanus, Arabella and Kleinmond
I was working from, it became quite difficult to concentrate on the webinar! The point is we human beings are incredibly adaptable, and during times of extreme crisis we generally do seem to find a way to make things work.
same way. In a buyer’s market, if you can afford not to sell, rather wait for the next seller’s market. That part of the answer is easy; what is more difficult, is to predict the next cycle.
ebinars, Zoom meetings, StarLeaf meetings, WhatsApp chats: who knew there would be so many ways to communicate with one another from the relative safety of our homes? I attended a global corporate webinar earlier this week with well in excess of a hundred participants. It was fascinating to observe those of them who had switched on their cameras.
But on to another webinar: Lightstone, a company which provides information, valuations and market intelligence on properties in South Africa, presented an excellent seminar to their clients during the week, and while what follows is reinforced by the information provided in this seminar, any opinions offered are my own.
Depending on which economist you choose to believe, the South Africa of the immediate future is going to show negative economic growth. The consensus seems to be between negative 3% and negative 8%. At the same time, the inflation rate is increasing. Some of this has to do with the continued weakness of the Rand relative to all major currencies, which means that imports will be more expensive in Rand terms.
Because the weather has been so beautiful over the last while I have relocated my office to my patio, where the view over my shoulder is directly towards the mountains in this beautiful part of the Western Cape. I received so many ‘chats’ asking where
We live in extremely uncertain times, but I wish to focus specifically on one question that is asked of me and my team on a daily basis: When is the best time to sell? You can go back to any of my articles and you will see that I always answer in much the
The Reserve Bank (SARB) uses an inflation targeting range in order to manage money supply in the economy. The SARB has indicated that it wishes to manage the inflation rate (or Consumer Price Index in particular) in a range of 3% to 6%. It does
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this by adjusting the Repo Rate on an ongoing basis. We have had another reduction in the Repo Rate (of 0.5%) during the past week, because the SARB is confident that by doing this we will stay within the targeted inflation rate. So, in a recession, if you are taking a mid-range recessionary pay cut of 5.5%, but inflation is going up by 4.5% (again at the mid-range), your real “loss” on an annual basis is 10%. That is the simplified theory. I think we can thus comfortably conclude that in this environment, house prices are not going to increase in value anytime soon. Back to the prime question: Unless you possess the skills necessary to see well into the future, no one can answer the “when do I sell” question with any certainty. The sensible answer, I believe, is that the present is the best time to sell, because the
? future is unknown. This is my fourth column written under lockdown. In any situation such as this, some will agree with the measures being taken while others will not. In South Africa we are allowed to do just that – have differing opinions. That is why we are called a democracy. My plea to all the citizens of this place we call home is to try as much as possible to observe the lockdown provisions. Our President has asked us to behave according to the regulations, so whether we agree with them or not, the longer we ignore them, the longer we will stay in lockdown. Hopefully by the time I write my next article it will again be from my office in Hermanus! #Better Together #Stronger Together #Stay Safe. The views expressed above are those of the writer in his personal capacity and may not necessarily reflect the views of Fine & Country as a national and international brand.
