So a property of R1 Million costed for an European around Eur 118,000.
Anno 2014 the Rand has weakened to 15:1, and now the same property, assumed it increased its value R1,2M in 10 years time, would cost in Euro's Eur 80,000.
Not bad if you live in Germany and earn your income in Euro's! Well, it is possible that some foreign buyers may take advantage of bargains, but whether it would have a significant impact in the same way that SA's goods and services exports remains unkown.
But how does the weak Rand affect the property prices in South-Africa?
The Rand is seen by many as the share price of South-Africa, and radical depreciations can bring about an air of gloom in the country. The most recent bout of broad Rand depreciation has been a sustained one too, lasting all the way back to 2011. The impact of the weaking Rand influences the import, and therefore interest rates.
And as the residential market is depedent on credit from banks the weaking Rand has a negative influence on the buyers financial ability. Increased prices for fuel and goods puts pressure on the budget of potential buyers as well.
Let's hope the government can turn around the dramatic downfall of the Rand!
