INTEREST RATE HIKE - COMMENT FROM CEO HERSCHEL JAWITZ, JAWITZ PROPERTIES
Jawitz Properties’ CEO Herschel Jawitz says that the latest rate increase by the Reserve Bank will not improve the confidence of an already fragile consumer. While the residential market has continued to outperform a slow economy, weak consumer confidence driven by stock shortages and good demand, there has been a slowing in the rate of growth of house prices in 2015. It is likely that house prices, in real terms off the back of the latest rate increase, may well decline in 2016.
The 50 basis point means an increase in repayments of R165 per month per R500 000 of bond. “This may not appear to be particularly significant at first glance, but when added to the previous rate hike it begins to add up.
Even though demand may be slow, the market will remain well balanced between sellers and buyers presenting opportunities for both parties to achieve fair deals,” he says.