17 Feb 20

Property market capitalises on SONA in 2020 – PRESS RELEASE

South Africa was attentively watching the State of the Nation for key answers to the future of South Africa’s growth. The government, along with the public, are well aware that there are challenges that desperately need to be faced to change the dynamics of the country.

“Following our outlook on what the State of the Nation had to deliver, and the possible solutions President Cyril Ramaphosa would look to, we are encouraged by what has been conveyed. The property market will be positively affected by the changes taking place, and we are optimistic that the new property developments launching will work hand-in-hand with bringing some of these key actions to fruition,” shares Stefan Botha, Director of Rainmaker Marketing.

The plan to restore Eskom to its former operational standards and overcome load shedding has been addressed strategically with alternative actions. These include, but are not limited to, Municipalities procuring their own power from Independent Power Producers, the introduction of grid capacity through the likes of renewable energy and natural gases. Additionally, they are looking to register small scale distributed generation for own use under 1MW without a license.

“These short-term solutions will have a powerful impact on the economy and how we consume and generate energy. Sustainability is becoming a major deliverable in property development; what was once a unique feature, is now becoming a way of life. Developers are certain to pioneer this movement towards these new grid capacity solutions. Not only will these properties create sustainable communities, it will also produce a more conscious population,” explains Botha.

Property developers, homeowners and foreign investors can rest assured that their investments into residential land, freestanding and sectional title homes will not be under threat through the expropriation of land without compensation. President Ramaphosa made it very clear that land reform would be approached with extreme caution. The main objective of this bill is to target agriculture to generate the greatest potential for growth.

“We have been waiting for clarity on this topic for some time and the State of the Nation speech was a very telling statement of what this bill would target. To date, the President shared that already 44 000 hectares of state-owned land had been distributed for the settlement of land restitution claims, and that 2020 would see approximately 700 000 hectares of state land will be allocated for agricultural production and growth. The fact that government has made it clear that they are releasing State-owned land will give all South African’s and foreign investors confidence to invest in real estate once again. We are assured that the land expropriation bill will have no impact on the residential market,” explains Botha.

The Infrastructure fund, which was announced 2 years ago, has evolved with a finalised “shovel-ready” list of projects worth over R700 billion. This 10-year project, developed to boost economic growth and investment into South Africa, will target areas such as student accommodation, social housing, independent water production, rail freight branch lines, electricity generation, municipal bulk infrastructure and a broadband roll-out.

“What was even more assuring for South Africans is that there is precise direction in creating economic growth across the board. Building a better foundation starts with the improvements of our basic infrastructures that will potentially drive investment and growth in the economy. We are pleased to see that the upgrade and upliftment in essential infrastructures has been prioritised by government and private contributors,” shares Botha.

He adds “The procedures set to combat crime in South Africa is set to help boost tourism into the country, with a prediction of international tourist arrivals to double to 21 million by 2030. All these factors will feed investor confidence and expose the globe to the potential South Africa has to offer.”

The positive messages from the State of the Nation Address will mean nothing if these plans are not followed by action. The strategies outlined are a step in the right direction, and the property market will, with no doubt, capitalise on the sentiments going forward, and will work collectively to boost South Africa’s economy.




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