Property Trend Dynamics

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Property Trend Dynamics

• By Victor Hugo

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RAND stronger - good news - is saying SA interest
rates are headed lower. SA becomes a serious
prospect for long term mining and infrastructure
and property investment.
 
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Why the Rand stronger? Partly because the US is
heading weaker.
 
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Interest rate differential - R153 yield in
long-term downtrend. 
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• SA uniquely positioned to benefit from shifts in
  investment flows
• -       resources gateway
• -       debt reasonable
• -       stable, non-militant people and
  government, corruption and crime being addressed
• infrastructure growth although sluggish,
  national mood hungry for growth - JSE TRANSPORTS,
  FIXED DEVELOPMENT BENEFICIARIES E.G. BARLOWORLD,
  GROUP 5, ALTECH, REUNERT - JSE CONSTRUCTION
  BUILDING MATERIALS Index is positive medium and
  long term

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SA property prices have lagged rest of world
   
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Keep an eye on GRAYPROP, APEXHI B, PUTPROP
great yields and are in long term uptrend.  
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• Risks 
• US assets (particularly property) bubble POPS
  domino effect
•  SA - any hint of creeping socialisation,
  compromise on Rule of Law or shocks to
  agriculture would slow long term investment and
  put pressure on Rand and interest rates again. 
• But SA fundamentals and technicals for property
  sector look good.

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Questions and Discussion.