Massive Anticipated State Boost to the SA Economy will be of Great Benefit to the Property Sector
Category News
With the Coronavirus and Moody \ Fitch's further downgrade of South Africa's economic outlook bringing the country almost to its knees, there is a growing expectation that the government's 2020\2021 budget is about to be revised drastically and a large-scale infrastructural investment programme initiated to revive the economy. This is designed to keep many businesses afloat and to prevent the already high official unemployment rate, rising almost overnight by an anticipated 50%.
"The figures and trends previously used as guide lines no longer apply: a total rethink is now recognised as essential," said Alexander "and the government seems to recognise the urgency with which this is required.
"South Africa's GDP, we are told, will decline by up to 7% if drastic measures are not taken NOW. The government will have to increase its very high borrowings to save us from a countrywide meltdown. This will not be easy as SARS is already over R60 billion short of its anticipated tax income for this year and our borrowings are already excessive - but there is clearly no alternative." The sum to be injected into job creation initiatives over the next two to three years, said Alexander, is reported to be in excess of R3 trillion.
It has been shown worldwide, that one of the great advantages of such infrastructural boost programmes is that property and the construction sector are always among the main beneficiaries of such input.
"I have already gone on record saying I do not expect the average middle and lower bracket housing sector prices to collapse as a result of the huge difficulties SA now faces. This widely expected boost from the State will very definitely assist property, particularly residential property, to ride out the many negative factors we will face in the next year or more. As is so often the case in traumatic times, property will be a good place to be; and it seems some recognise this: our agents, now working from home, will have concluded five deals in the next ten days using only electronic media to introduce the properties and their gardens to prospective buyers. Never has the "Video walk-through method" showcasing a property, been more useful and effective."
For further information, please contact Rowan Alexander on 082 581 3116 or by email : rowan@asproperty.co.za
Author: Rowan Alexander
