Brace for Covid-19 property, economic pain, warns Siphamandla Mkhwanazi, FNB property economist

Siphamandla Mkhwanazi, FNB Property Economist, says the South African economy is expected to be in a short, but deep recession this year. The economy is expected to shrink by 4.5% y/y for the year - and that is the base case and considerably worse than the (-1.5%) contraction experienced in 2009. In this podcast, he speaks to Jackie Cameron, of BizNews, about the likely impacts of containing Covid-19 on the country's property market, which he outlines in an in-depth report. "For the housing market, we expect a more dramatic impact on transaction volumes, rather than home values. House price growth will likely slow in the low to middle-priced segments, and nominal decline will deepen in the upper end to reflect weakening fundamentals," he says. It's a buyers' market, though buyers are thin on the ground and deals are hard to get through, with logjams in the system. Also expect more repossessions as some property owners fail to secure extra financial help to survive what is likely to be a very challenging time, he says. - Jackie Cameron