The Property bubble
pop goes your house
Cape Town accommodation has always been the bright, shining light for property owners. Way back in 1998, it was predicated that the property market would one day burst, showering us cheap property prices and excessive wealth. This was sadly, not to be. As I speak now, a one million rand home in Parklands has just gone on sale. Ten years ago, this same home would have gone for R150,000 and the million rand would have managed to secure you a beach side property at Clifton beach.
Why is this so? in 1998, we were vying for the Olympic games, but because of our decades of bad press, another lesser country was relegated the winning vote. I remember that day fondly. Millions of people were jumping up and down and the vote was of course given to Athens. In under 5 minutes, every single one of these Olympic party-goers vanished into the cold night air. I chuckled a bit. Who needs that sort of influx. Wait until the Fifa world cup rips us apart in 2010. There will be nothing left but fat Germans in shorts, socks and sandals. But I digress.
The reason the property shot up was because of the anticipated win of the Olympic games. We never won, and we lost the battle for cheap housing as well. After that, the interest rate took a steady hike and the greedy credit companies have been smiling ever since. Just think of what a million rand will get you in another decades time. Perhaps a pleasant outhouse in Khayelitsha?I shudder to think of the alternatives.
