Advice for buyers

When to expect the next property boom

Start Saving for that investment property now

The two most recent property booms in South Africa, peaked in 1981 and in 2004. With a 23 year gap between the two peaks one could be forgiven for thinking there is a lot of time yet till the next one which based on the past trend will peak around 2027 a full 12 years from now but the reality is rather different.

Assuming the trend will continue and that those holding investment properties at the time will experience at least a doubling of their asset value in a very short time it is critical to invest at the right time.

In fact if one looks at the property market of the past 30 years the earning potential is phenomenal.  Considering that property prices increased by 130% between 1977 and 1984 and by 150% between 2000 and 2008 it is apparent that buying investment property at the right time is crucial.   You may have noticed that the boom of ‘81 in reality lasted for much longer than just that a year and started a whole lot earlier than 1981, 1977 in fact.

So, what to make of this?

The booms are 23 years apart they last for approximately 8 years, (4 years on either side of the peak) and we are now 11 years past the last boom peak. Assuming one wants to get in right at the beginning of the next boom that means we need buy at the beginning of 2023, that’s just seven years from now.  So start saving for that deposit because seven years from now you want to be able to buy that second property.

Derek Ross
Glendyr Dade Properties