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IT'S time for consumers to stop focusing on the immediate problems in the real estate sector and start focusing on the bigger picture.

So says Berry Everitt, MD of the Chas Everitt International property group, who notes: "Homeowners and sellers are currently preoccupied with a possible decline in prices but they need to realise that this is part of the perpetual economic cycle, in which the prices of all commodities - including property - go up, go down and then go up again."

He points out that homeowners who bought their properties five years ago and held them today have an asset that is worth at least 100% more than they paid for it, "so if they have to sell today they may not get what they would have got last year, but it is highly unlikely they will actually lose money".

On the other hand, they may be able to upgrade for less than it would have cost them last year. And if they continue to hold their property, they will derive more benefits when prices start to rise again.

Meanwhile, such owners may also have had the opportunity to utilise some of the increased equity in their properties to improve their lifestyle.

"But rising prices are dependent on demand, and that tapers off at a certain level due to lack of affordability. To enable new buyers to enter the market and keep the economic cycle going, prices have to come down or at least level off at some point. This is where we are now, and from a seller's point of view, SA is a great place to be, because it has one of the few real estate markets in the world where there are literally millions of potential buyers champing at the bit to become homeowners."

'There is a huge market'
Indeed, a recent survey conducted by Markinor for the Reader's Digest shows that more than 50% of South Africans rank owning their own home as their most important life goal, "which means that there is actually a huge market for homes that are for sale, provided they are pitched at the right price".

This is, he says, just one of the opportunities inherent in the downward phase of the economic cycle. Another is that higher interest rates at the moment are driving up the demand for rental properties.

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