This has been a hard month for blogs.
“No news is good news” the saying goes. This really is a time of no news. I’m beginning to think that this is the New Normal. On the one hand, it’s not that bad and many of us are surviving on what’s on the table; certainly not shooting the lights out but “in there”. On the other, we are developing two horrible tolerances:
– We believe this is how life is and become accustomed to the state of affairs.
– We accept that politics will determine our fortunes and allow the chronology of elections and the antics of the ANC to determine what we do.
Please never feel when I write like this, that I’m “preaching at you”. That is not my style. I too have the tendency to relate the future to the ANC Elective Conference and then to the 2019 Elections. And frankly, we are in the cross-winds at the moment and being buffeted by spectacular news from every side. Some is highly negative [depending on which side you are on!] and some of it, sensationally criminal [depending on which side you are on!]. A tough environment indeed, in which to ply our trade.
In this context, I often have sympathy for John Loos of FNB. In his latest Mortgage Barometer, he discusses the SARB 2nd Quarter Bulletin for Mortgage Lending. Remember, this is one of the largest assets that the SARB measures and it is a huge part of the Banks’ balance sheets.
In Q12017, there was an uptick in the rate of growth of new mortgage loans lending [Residential, Commercial and Agricultural]. For those of us who know the industry, that was the December “over-run”. In Q22017, that growth sank to a year-on-year rate of change measuring -2.18% decline, compared to a briefly positive rate of +6.49% in the 1st quarter. John continues to tell us why – household and business sector confidence at sustained low levels.
So what’s new? Well, CapeTown is beginning to show signs of slowing, off astronomically high price growth rates. But I have just finished a Skype call with a friend in Sydney which creates some perspective. He tells me that the young people cannot afford a house in the city limits any longer. A 2-bed/bathroom flat sells for Aus$1.2m, about R12m in the suburbs. The same unit in Kenilworth in Cape Town sells for R3.5m – that’s roughly a quarter of the Aussie price. For interest rates, Aus is 5% vs our 9.5%. However, one of the reasons for their high prices, is that the Chinese are buying developments wholesale and then, once complete, selling them to incoming compatriots for Aus$100000 more per unit. Quick money and almost insatiable demand, to the exclusion of the real people of Australia. Globalisation and capitalism at its best or worst [again, depending on which side you’re on!]
In a nutshell, if you allow articles, the Free [thank God] Press and Google to determine the upside of your day, you may be doomed to negativity. The times are tough in our beautiful, tortured country but forces are afoot across the world, that are causing turbulence for many businesses and industries.
HLJ is at the forefront of everything mortgage. Again recently honoured for excellent performance, the business is thriving on all that is available in the market. We understand success in the tough times and have enjoyed it in the bad. But for you, our associate, consultant, business partner and client, we assure you of being there and treating your requirements with the utmost respect and professionalism. Simply put, we read the Press and work harder to thrive.
Yours in Property.