Historically the real estate development market in South africa has been vibrant. Shield for your windshield the current world economic slump begin to take hold back in September 2008, it drained the confidence associated with your many investors and the market nose-dived plus the general economic situation. But with the signs of economic recovery beginning to be able to hold again, what prospects are there for a resurgence in the commercial property markets?
When industrial and commercial property prices reached a new low, it signaled a couple of things. Firstly that the market was severely depressed and was likely to stay that means for several years, but that the bottom of the trough had been reached of which the best out, was up. With the market having stabilized at its new low, it meant that the glut of distressed properties that were being pouring in had stopped, and together with laws of supply and demand in operation, more than excess of supply far outstripping demand, kent ridge residence prices remained depressed.
However, you will develop 12 months has seen the signs and symptoms of recovery as far back as in sector sector, together with property prices still artificially low, this 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. With economic forecasts being positive, albeit slow-moving, and costs being at only they are, now is an excellent time purchase. As confidence returns to the economy, possibly new letting agreements is rising and properties are had been beginning to move, introducing a slow but steady rise in prices and rates. Is usually forecast that trend continues slowly but surely, depleting the supply surplus that eventually trigger a new bout of property development taking venue.
Current thinking is this may well lead to an industrial property boom in 2014/15. However with associated with long gestation period for first time developments arrive at final fruition, the process needs to get kicked off now. Feasibility studies, surveys, finance – all of the listed things should be in place before actual construction can start to show up.
All for all this is already a very positive time for property development. Industrial property investors have every reason to be cautiously optimistic, as it is definitely to medium term prospects are looking very positive, and the next step is to speculate and develop.