The economic Property Development Market – From Bust to Boom

Historically the real estate development market in South africa has been vibrant. Even so, if the current world economic slump started to take suppress in September 2008, it drained the confidence out of many investors and marketplace nose-dived considering the general finances. But with the signs of economic recovery beginning to be able to hold again, what prospects are there for upset in the economic property market?

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 to keep that approach for several years, but additionally that the bottom of the trough had been reached of which the sole method out, was up. With all the market having stabilized at its new low, it meant that the glut of distressed properties that are already pouring in had stopped, and with laws of supply and demand in operation, with the excess of supply far outstripping demand, prices remained depressed.

However, given out 12 months has seen the signs and symptoms of recovery developing in industrial municipal debt market sector, by means of 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 an illustration of this the current optimistic outlook. With economic forecasts being positive, albeit slow-moving, and prices being the small sum of they are, now constitutes a time purchaser. As confidence returns to the economy, possibly new letting agreements is rising and properties are much more beginning to move, creating a slow but steady rise in prices and rates. It is forecast that this trend will continue slowly but surely, depleting the supply surplus which will eventually trigger a new bout of property development taking venue.

Current thinking is this may well lead a good industrial property boom in 2014/15. Of course with any long gestation period for new developments arrive at final fruition, the process needs always be kicked off now. Feasibility studies, surveys, finance – all in the things must be in place before actual construction starting to show up.

All for all this is already a very positive time for property development. Industrial property investors have every reason to be cautiously optimistic, as simple to medium term prospects are looking very positive, and the time has come to speculate and kent ridge residence invest.