Summer is without a doubt the most anticipated & talked about event in the British calendar. If the Poms spent half the time preparing for summer, and focus the other half on their football, then maybe they’d be able to win another World Cup…….and so relive the glory days of 1966 (was a cheapshot, I know :)
So why the big hoohah? Cos the British summer, is just so flippen short…….
The big talking point of the last few months has been the expected reduction of interest rates. The SARB has even gone so far as to increase the number of meetings to be held in order to, and here I quote ‘To allow for more effective planning and quicker reactions to changes in the economy’. (I think to the members of the MPC, it means more buffet lunches)
But will any kind of reduction in interest rates prove to be a British summer for the current property market? The short answer is unfortunately, no. The real dampener is the difficulty in obtaining credit from commercial banks. But this is to be expected when there’s an increase in the unemployment figure, as well as another negative growth forecast for the second quarter of the year. And with house price growth at a reported -5% year-on-year, we are still not out of the woods…….by a long shot !!
So what can be done? Popular opinion is that the SARB will cut prime interest rates to 10.5% by the end of the year. But seeing as each interest rate cut takes about 6 to 9 months, to work itself through the economy, this is not the short term answer.
Therefore, it seems as if everyone is taking a ‘Look and See’ attitude coupled with what happens domestically as well as globally.
So without further ado, get out your swimming trunks, splash on some sunscreen and hit the beach (or river), cos anything is a lot better than nothing.
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