'Safety and crime' still top risk affecting home buying in SA
New World Wealth recently reviewed the top risks facing the South African economy as part of their 2019 South Africa Wealth Report.
The top 4 risks highlighted in the 2019 SA Wealth Report include:
- Loading shedding and Eskom - the troubled power utility has a massive amount of influence over South Africa.
- Safety and crime.
- Threats of land redistribution without compensation - this could negatively impact on residential property prices, which could in turn lead to big problems for local banks (as most banks have large mortgage debt books).
- Possible nationalisation of the healthcare sector - this could damage the private healthcare system, which could cause large numbers of wealthy and middle class people to leave the country.
"The second point (safety) is probably the most critical," says Andrew Amoils, head of research at New World Wealth. "Notably, over the past few years there has been a big move away from freestanding homes towards apartments and secure estates - this is primarily driven by concerns about safety in SA."
He says apartments that are connected to shopping centres such as Melrose Arch in Johannesburg have become particularly popular as they allow residents to go to shops, restaurants or work without having to drive or walk across any dangerous roads. This is of course linked to a need for safety.
"Beachfront apartments which are very secure and where one can go for long walks on nearby pedestrian pathways, such as the Pearls in Umhlanga, have also become very popular for similar reasons."
Author: 2019 SA Wealth Report