The economic Property Development Market – From Bust to Boom

Historically the home or property development market in South africa has been vibrant. But when the current world economic slump started to take hold back in September 2008, it drained the confidence involving many investors and marketplace nose-dived considering the general finances. But with the signs of economic recovery beginning to consider hold again, what prospects are there for a resurgence in the industrial property trade?

When industrial and commercial property prices reached a fabulous low, it signaled a pair of things. Firstly that the market was severely depressed and was likely keep that means for several years, but as well that the bottom of the trough were definitily reached in which the greatest out, was up. Together with market having stabilized at its new low, it meant how the glut of distressed properties that were pouring in had stopped, and with laws of supply and demand in operation, while excess of supply far outstripping demand, prices remained depressed.

However, the last 12 months has seen the signs of recovery going on in the commercial sector, along with property prices still artificially low, it has begun to stimulate demand, as property development speculators are one again sensing the opportunity of making good short to medium term returns on new investments.

Office properties in particular are a good example of the current optimistic prospect. With economic forecasts being positive, albeit slow-moving, and costs being the small sum of they are, now is an effective time purchase. As confidence returns to the economy, the chance of new letting agreements is booming and properties are much more beginning to move, creating a slow but steady rise in prices and rates. It can be forecast until this trend will continue slowly but surely, depleting the supply surplus that eventually trigger a new bout of property development taking venue.

Current thinking is this specific may well lead with regard to an industrial property boom in 2014/15. Of course with any long gestation period for new developments to find final fruition, the process needs staying kicked off now. Feasibility studies, surveys, finance – all of these things must be in place before actual construction starting to reside.

All buying this will finally be a very positive time for property development. Industrial property investors have every reason to get cautiously optimistic, as the short to medium term prospects are looking very positive, and now is the time to speculate and kent ridge hill residence put.