Historically the house and property development market in South africa has been vibrant. Coverage the current world economic slump started take suppress in September 2008, it drained the confidence coming from many investors and the actual marketplace nose-dived plus the general economy. But with the signs of economic recovery beginning to look at hold again, what prospects are there for becoming bitten in the commercial property area?
When industrial and commercial property prices reached another low, it signaled a couple of things. Firstly that the market was severely depressed and was likely to keep that approach for several years, but as well that the bottom of the trough ended up reached this the very best out, was up. With the market having stabilized at its new low, it meant how the glut of distressed properties that were pouring in had stopped, and that isn’t laws of supply and demand in operation, while excess of supply far outstripping demand, prices remained depressed.
However, given out 12 months has seen the signs of recovery occurring in the commercial sector, other than property prices still artificially low, it has begun to stimulate demand, as property development speculators are one again sensing the opportunity of making good short to medium term returns on new investments.
Office properties in particular are an illustration of the current optimistic outlook on life. With economic forecasts being positive, albeit slow-moving, and costs being under they are, now is a good time purchase. As confidence returns to the economy, the chance of new letting agreements is rising and properties are had been beginning to move, leading to a slow but steady rise in prices and kent ridge hill residence rates. Is usually forecast that this trend continues slowly but surely, depleting the supply surplus may eventually trigger a new bout of property development taking point.
Current thinking is this kind of may well lead a good industrial property boom in 2014/15. Keep in mind with any long gestation period for first time developments to go to final fruition, the process needs to be kicked off now. Feasibility studies, surveys, finance – all things should be in place before actual construction can start to reside.
All in all this will finally be a very positive time for property development. Industrial property investors have every reason in order to cautiously optimistic, as it is definitely to medium term prospects are looking very positive, and now is the time to speculate and put.