What does this mean for you?
SA's recent downgrade to "junk status" has undoubtedly left you, as a seller, wondering: "Well, what now?" Here's what you need to know:
The most important thing to bear in mind, is that it is not all gloom and doom, so be careful about what you read and who you listen to.
While the shifting economic landscape is a serious matter and there will inevitably be financial consequences, these will take time to filter through. For now, it remains business as usual. In any event, Seeff’s agents say that life goes on. Everybody needs somewhere to live and people will continue to sell and buy or rent property in the normal course of business.
The first thing to remember, is that there is no need to panic or sell in a hurry. There will still be buyers and plenty of time to sell. The prices that buyers are offering might now be lower compared to two years ago, but we have seen a declining trend for the past eighteen months with demand and price growth contracting.
Sellers should therefore heed the advice of estate agents if they need to sell. Overpriced properties are not attracting attention and you will be wasting your time if you price too high. Remember, buyers tend to be put off by overpriced properties. By overpricing, you are likely to lose out.
It is also not advisable to think that if you start with a high price, you will end up with a good price. Rather, listen to the advice that the agent provides and list your property at the correct price level that suits the current market conditions.
The shift to junk status means that the property market will now shift to market related pricing as buyers will be looking for affordability.
If you need to sell, be careful about turning down an offer just because it is not quite the high price that you were hoping for. You may not get another offer. Rather, consider all reasonable offers and weigh up the risk of losing out on a sale. Remember, as time passes, the offers and prices may well reduce.
Any economy goes through cycles and we have seen this in South Africa as well with booms and busts. Regardless of the state of the economy, there are always opportunities and there will always be people buying and selling. Selling prices and turnover may be affected, but sales will still continue. As a seller, you would not want to miss out.