Price Pressure

Nationally property prices have been under pressure with some suburbs showing declining real house price over the past few months.

In Cape Town; the remarkable strength of the housing market over the past few years has started to show signs of slight weakening.

The average time a home is on the market before a sale has increased over the past 6 months. It now takes close to 20 weeks on average for a home to sell in Cape Town. A market is considered to be in equilibrium when homes sell in +/- 12 weeks.

With homes staying on the market longer there is a risk of a real house price correction. There is minimal fear of a local (Cape Town) bubble and the risk of significant price declines is considered to be very low.

However, price increases in the Cape Town market are expected to gradually return to the longterm trend line for house price inflation. The spectacular increases seen over the past few years are unlikely to continue.

Have you been holding onto you home, enjoying the 10% +annual  increase in value over the past few years? Have you  also been thinking about a change? With holding costs (rates, insurance and maintenance) increasing all the time, Now may be the time to begin planning for that change.

In the Claremont and Rondebosch market we started have started to see pressure being transferred to sellers. Over the winter period, average days on the market began getting longer, and in some cases homes were removed from the market not having sold.

Strategies for serious sellers in the current market;

1. Prepare your home carefully for sale – get ready to show its best face.
2. Ensure that you price competitively relative to similar homes on offer.
3. Be ready to negotiate.

Every home is unique and offers different benefits to the market. Its always a good idea to consult a professional agent before putting your home on the market.