Economic crunch likely to push SA’s first-time homeowners back to renting
As the ripples of the Ukraine war hit fuel and food prices, the property market is also expected to feel the heat
SA’s economic crunch, spurred by rising fuel and food prices in the face of the war in Ukraine, is unlikely to leave the property market unscathed.
Dr Andrew Golding, CEO of Pam Golding Property, believes the threat to the global economic recovery and additional pressure on household finances, through higher prices and a weaker economy, “is not positive for the residential property market”.
“The key issue for the residential property market is what happens to interest rates, and it is uncertain whether this will accelerate the pace at which interest rates are hiked, because it is likely that higher food and energy prices in a tepid growth environment mean it is problematic to pass on higher prices to consumers, so inflation is unlikely to become more broadly based.”..