Auctioneers Predict Weak 2011 Property Market

December 24 - One of South Africa's leading auctioneers, Auction Alliance gave its predictions for the state of the property market in 2011.

According to the group, the current state of the market leads investors to believe that the market will perform poorly next year.

Auction Alliance said that this year ended on an anti-climax, with a marked rise in distressed sales.

"A subdued housing market suggests that the year is ending with a fizzle, leaving many investors questioning whether the market will deteriorate further in 2011," said the group in review of its year-end results.

Auction Alliance ended 22% ahead of budget this year, having sold R5.2 billion worth of assets throughout 2010.

The auctioneers said that the broader market was "weak all year, particularly at the top end", despite the fact that low interest rates had pushed the growth of entry level residential homes.

Despite the low costs of borrowing, South Africa's property market could simply not be kick started, according to Auction Alliance.

This was similar to trends currently found in most North Atlantic countries.

"The bottom line is that next year we won't have the World Cup to boost infrastructural spend, tourism, mid year retail and most importantly investor sentiment," said the Chief Executive Officer of Alliance Auctioneers, Rael Levitt.

"It appears as if real estate is set to weaken further in 2011," he predicted.

12/24/2010 10:02:20 AM