An interest rate cut is likely this week, say economists, but will it be enough to get consumers to buy property?
The market appears to be awaiting further lending rate reductions that were forecast as the end of 2024, but international trends of negative CPI may indicate a lag in these forecast cuts. Picture: Karen Sandison/African News Agency South Africa n consumers are holding on to their money, being cautious about property purchases and not taking on more lending, according to economists.
“Increasing costs of living and household expenditure could consume any additional funds available from the two previous rate cuts last year,” Anderson said. According to the Standard Bank's unit, there is more positive sentiment at the beginning of 2025 and anticipation to see some property sector growth in the year in comparison to 2023 and 2024 where they knew that the market would experience contraction and less demand from buyers.
“The commercial and residential property sectors are expected to both see accelerating growth in South Africa leading out to 2030. This outlook is based on an expected improvement in GDP growth, further interest rate cuts, and moderate inflation,” Bishop said. “Although the property market is expected to continue some improvement, it is coming from a low base after Covid, and is struggling to fully recover due to poor fundamentals.
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