The economic Property Development Market – From Bust to Boom

Historically the property development market in South africa has been vibrant. Even so the current world economic slump did start to take suppress in September 2008, it drained the confidence coming from many investors and the market nose-dived plus the general economy. But with the signs of economic recovery beginning to take hold again, what prospects are there for an increase in the commercial property market?

When industrial and commercial property prices reached your own low, it signaled a couple of things. Firstly that the market was severely depressed and was likely keep that way for several years, but also that the bottom of the trough was in fact reached of which the greatest out, was up. Is not market having stabilized at its new low, it meant how the glut of distressed properties that were actually pouring in had stopped, and with the laws of supply and demand in operation, with the excess of supply far outstripping demand, prices remained depressed.

However, you will develop 12 months has seen the symptoms of recovery as far back as in the commercial sector, together with 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 this the current optimistic views. With economic forecasts being positive, albeit slow-moving, and costs being as low as they are, now constitutes a time purchase. As confidence returns to the economy, possibly new letting agreements is rising and properties are much more beginning to move, bringing about a slow but steady rise in prices and rates. Is usually forecast this specific trend continues slowly but surely, depleting the supply surplus may 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. Certainly with any long gestation period moms and dads developments to come to final fruition, the process needs to be kicked off now. Feasibility studies, surveys, finance – all of the listed things end up being in place before actual construction start to reside.

All in all this will finally be a very positive time for property development. Industrial property investors have every reason become cautiously optimistic, kent ridge hill residences price as it is definitely to medium term prospects are looking very positive, and the time has come to speculate and put.

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