Homeowner confidence in SA declined in the fourth quarter of 2021 due to ongoing pandemic-related instability – though overall sentiment remains high, indicating confidence in the property market.
This is according to the latest Absa Homeowner Sentiment Index, which surveys consumer confidence levels in the property market in South Africa.
Homeowner confidence in SA declined by 3% to 79% in the fourth quarter of 2021 compared to the third quarter due to instability caused by the Covid-19 pandemic, the index said, although 42% of respondents still consider it a good time to sell property. First-time homebuyer confidence has remained strongest.
Key concerns among homeowners included economic stability, high levels of unemployment, and a lack of job security.
The latest survey was undertaken at the height of the Omicron wave. Furthermore, unemployment levels in the country increased from 34.4% in the second quarter of 2021 to 34.9% in the third quarter and is the highest joblessness rate since 2008.
Investors had the highest decline in sentiment towards buying, citing economic instability, high property prices, as well as showing an increasing concern around interest rates.
"This decline in buying sentiment by investors is a significant change to the previous quarter where this segment's buying sentiment had reached its second highest level post lockdown (88%) and now has the lowest buying sentiment across all segments (79%)," states the index report.
According to TPN's vacancy survey, landlords continue to be under pressure; vacancy rates increased from 10.66% in the third quarter of 2021 to 11.71% in the fourth quarter. This is much higher than the 7.47% average prior to the pandemic and is coupled with lower rental escalations as unemployment continues to put financial strain in the renter segment.