Property investors cautioned for 2007

Property investors must be cautious and review their strategies, making plans to adjust accordingly in 2007.

This is the advice from investment property experts, Bales Delaporte who say that the residential and commercial property markets have changed recently. “In reviewing where the commercial market is heading,” says commercial property dealmaker Tony Bales,  “one must consider the main factors that will affect the next few years.”

“Positive factors are things such as the 2010 Soccer World Cup and Nakheel’s purchase of the V & A Waterfront, which now makes SA a truly top class investment destination and has led to a host of large international property players seeking property investment and development opportunities in SA.”

“Another positive factor is the growing local JSE listed property sector as well as internationalization of the local JSE listed property sector towards an internationally accepted Real Estate Investment Trust (REIT) structure,” says Bales Delaporte.  “GDP growth has also expanded local economy and demand by tenants and investors and rental growth in the office and industrial sectors is due for solid growth during next few years.”

According to Bales Delaporte, the negative factors that will affect property investing in 2007 are things such as the rising building costs and rising interest rates, further depreciation of the Rand, traffic congestion in the major metropolitan areas and the fact that construction capacity is currently running at maximum capacity.   

“The vast majority of positive influences on the property market indicate a period of solid growth moving forward, but such growth may be in different ways to what has been seen in the past and investors do need to continually evaluate what they are doing.”

“Stay close to the experts and stay close to what is really happening and look forward to new horizons rather than looking backwards at the setting sun for solutions,” concludes Bales Delaporte.

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