Are the Bosasa revelations good or bad for homes market sentiment?
Category Blog
My burden of concern about the state and prospects of our nation and its residential property market has been lightened by the revelations that have been seeping out of the Zondo and other commissions of inquiry into State capture.
Knowing and understanding a problem is the critical first step in the process of dealing with it.
Until now, we have seemingly all been floundering around anxiously in a dark room while expecting to fall inevitably into a hole.
Fortunately, the mind-boggling evidence rolled out by former Bosasa executive Angelo Aggrizzi and other witnesses at the Zondo and other commissions has turned the lights on.
While it may not have revealed a pretty landscape, the country now knows what it faces. The problem is no longer hidden and can therefore no longer be side-stepped. The very fact that such misdeeds are being revealed is a positive indicator.
A simple answer
The question is: How many other Bosasa-type issues remain out there, undiscovered and unpunished? Are we well on the path to becoming a gangster-driven society? Or will we be pulled back from the cliff by good governance?
The answer is simple: Who knows at this stage?
Meanwhile, what looms immediately is just how the reality of this corruption issue will be absorbed, digested and, above all, acted upon both by Government and the business sector. And what impact will it have on the mood of home buyers and sellers?
The key fact is that the residential property market is, always has been, and will remain, linked to sentiment. Positive sentiment is always reflected almost immediately in an uptick in property transactions.
If we have faith in the inevitable changes that seem set to follow the outcome of the Zondo and other commissions, the market sentiment pendulum will almost certainly swing to the positive side.
Wasted years
That will undoubtedly be a welcome change from the residential property growth flat line that persisted during the so-called 'wasted nine years' of the Zuma presidency. Bad government always reflects into a bad homes market.
Looking ahead under the Ramaphosa presidency, I am encouraged by the fact that, when positive residential market sentiment inevitably re-emerges, it will very quickly reflect in an increase in buy/sell transactions.
It certainly happened at the beginning of 2018, when he took over the reins at the Presidency and "Ramaphoria" first came to light.
Coincidentally, it was a year in which Ennik Estates achieved a, still-unbroken, record price of R12,75-million for a Parkview (Johannesburg) home!
I remember it well.
Author: Ronald Ennik
