Experts say selling prices are unrealistic

By Staff Writer

Home sellers who don't want to lower their asking price will struggle to make a sale since the debt-ridden South African public will continue to avoid buying high-priced houses. This is according to First National Bank's (FNB's) property analytics department.

According to FNB housing specialist, John Loos, the residential property market is jampacked with homes which are struggling to sell.

"Asking prices are still too high given the weak level of residential demand," said FNB housing specialist John Loos.

He said surveys of estate agents for the review point to an unrealistically priced market.

The report revealed that the average time of a house on the market is 15 weeks and four days, which is almost double the eight-week time period from 2005 and 2006.

"There is a lack of realism in the market," said Loos. FNB estimates that 81% of sellers had to lower their asking price to make a sale in the third quarter, compared to 30% in 2004, which recorded the lowest average fall in selling price.

The estimated average drop in asking price was 12% for the third quarter of 2010.

Loos said that the household's sector's lack of interest might result in lower house prices which is good news for those looking to invest in property but bad news for home owners who will be forced to sell at a possible loss.

"Indications are that the supply of existing property is strong, with high levels of financial stress-related selling. Indications are also that residential demand is currently weakening. That leaves a price decline as seemingly the logical outcome," he said.

"We retain the expectation of average price decline for 2011 as a whole," said Loos.

Recent Articles

Featured Request your credit report from the right bureau

With so many different credit bureaus in South Africa, it may be difficult to decide from which one to request your credit report. We have a look at what you should be aware of when selecting a credit bureau.

Applying for a home loan? Consider the repo rate

When you apply for a home loan, one of your top priorities should be to secure a low interest rate. In order to achieve this, you need to be familiar with the repo rate. We find out more about this.

Effective financial planning as a single parent

As a single mom or dad, it can be challenging to keep up with the ever-increasing expenses of raising a child. We have a look at the importance of setting up a budget as a single parent.

How your credit score impacts your insurance – and vice versa

Since insurance is paid in advance, it may seem unrelated to your credit score. However, these two are in fact linked to one another. We find out why insurers look at your credit score.

Deals

Get a FREE flight ticket with Hotel Sky

Price: From R5,200
When: Until 31 January 2022
Where: Johannesburg and Cape Town

Voucher for 2 special at Bakwena Day Spa

Price: From R1,798
When: Until 31 January 2022
Where: Centurion, Hartbeespoort and Stellenbosch

Spier Hotel Summer Special

Price: Available on request
When: Until 31 March 2022
Where: Stellenbosch


Latest Guide

Guide to debt rehabilitation solutions