Budget bodes well for property owners
The budget provides the first signs that the government is considering ways to incentivise personal savings through the housing sector. And in time it may follow international trends and offer a tax incentive on bond repayments, according to property economist Francois Viruly. The value threshold for transfer duty was increased from R500 000 to R600 000 and it was announced that the government would explore an incentivised savings scheme for first time home buyers. Viruly, a professor at the department of construction economics and management at the University of Cape Town, said the Budget would provide some level of stimulus for the lower tiers of the residential property sector and revealed the government's commitment to promote household savings through the residential property sector. Viruly said the emphasis on infrastructure, particularly for transport, boded well for all sectors of the property market in the longer term. He said an efficient transportation system played a critical role in creating an urban environment that was accessible to diverse income groups. Pam Golding Property chief executive Andrew Golding welcomed the increase in the transfer duty threshold. The estate agency was looking forward to more details about the incentivised savings scheme for first time home buyers. Aida National Franchises chief executive Young Carr was pleased with the R122 billion allocation for the provision and improvement of housing, water and community amenities this year and the fact that the government was to spend more than R21bn over the next three years upgrading 400 000 homes in informal settlements. Hano Jacobs, the chief executive of the Realty 1 International Property Group, said the growth of the property market was entirely dependent on increasing employment levels and the number of people who could afford to rent or buy their own homes, so the job creation plans could expand the market.