Housing in Southern Africa June 2016

News

Masiphumelele BNG project The civils tender process for the City of Cape Town’s R50 million Masiphumelele Phase 4 Breaking New Ground housing project is currently under way.

T he first stage of the Masiphu- melele Phase 4 housing proj- ect has been earmarked for qualifying applicants living in in- formal settlements or backyards in the area. Construction of 227 fully serviced sites in the wetland area is envisioned, says Mayoral Commit- tee Member for Human Settlements, Benedicta van Minnen. A total of R50 million has been allocated for civil services and infrastructure between September 2016 and June 2017, with housing units rolling out between July 2017 and June 2018. “We are doing everything we can

to ease the acute housing need inMa- siphumelele and also in other areas across the metro. In areas such as Masiphumelele, where residents are well organised on political and civic levels, we are dependent on the sup- port and cooperation of the residents and community leadership. “Too often, our projects are de- layed because of a lack of assistance at grassroots level, for various rea- sons. This is to the detriment of our most vulnerable residents and our aim of enhancing the delivery of housing opportunities and basic ser- vices as a means of driving redress,” says van Minnen. ■ T his follows three successive hikes. Seeff says that although the better than expected April Consumer Price Index rate of 6,2% is marginally above the Reserve Bank’s target range of 6%, it is slight enough to support the decision to the keep the interest rate flat. There would have been no value in raising the interest rate right now given that the initial fears of rocketing inflationseems somewhat overstated. A rate hike does not serve the econo- my and the rate hikes have done little to deter consumer spending. Seeff adds that in a more buoyant economy, a higher interest ratewould be acceptable for a fair and balanced market. As things stand, the economy would be better served by a stable interest rate. The propertymarket could dowith a boost. While transactions are below the levels of 2014 and early part of 2015, the market nonetheless remains fairly active. “We have not yet seen the doom and gloom predicted at the start of the year, save perhaps for the mining towns. Bear in mind that therewill always be peoplewho need to buy for various reasons, relocating, downgrading and upgrading. Rising

No repo rate hike Chairman of the Seeff property group, Samue l See f f, has welcomed the decision by the Reserve Bank’s Monetary Policy Committee to retain the repo rate at 7% (the base home loan rate is at 10,5%) as a much needed boost for the economy and property market.

Samuel Seeff

interest rates and general living cost inflation is set to remain a challenge this year,” says Seeff. As the year progresses and more stock comes onto the market, sellers will face increasing pressure to price competitively. On the upside, accord- ing to the latest bank indicators, the decline in price growth seems to have halted for now. Overall, Seeff still sees a very satisfactory market. All eyes will now be on the up- coming local elections with some expected shifts of power from the rul- ing party. “This,” says Seeff, “should hopefully be a strong signal that government needs to lift its game as poor service delivery, inefficiency, waste and corruption do not support economic growth. And, without a good economy, we cannot expect a good property market.” ■

June 2016