Nico's November Message
Category Newsletter: Message from MD
We are well into the final quarter of the year leaving Renico with just six precious weeks before we conclude our race for 2016 and cross the finish-line. Our affiliated professional and construction teams are working around the clock to complete the developments we currently have in progress while the pre-construction planning teams are attending to all that needs to be put in place to enable us to launch numerous new developments early in 2017!
On the economic front we await with bated breath the dice-roll verdict of the credit rating agencies on our country’s status. A further downgrade will most definitely guarantee South Africa’s “Junk Status” with dire effects on the future growth of the economy.
Although laced with a dose of empathy for the due cause, the chaos in our tertiary education institutions is adding petrol to fire and negatively impacting on the already economically turbulent South Africa. It is sad to see that a small number of protesting university students are turning to violence and in some cases preventing the willing majority of students from finishing their year’s hard work. This will trigger a domino effect with great emotional, financial and socio-economic repercussions in the long run. One can but wonder what the state of tertiary education will be in next year as our 2016 matriculants aspire to further their education that will enable them to eventually assume their rightful place in the building of our future.
On the new residential property front we have seen a steady decline in the number of purchasers being granted bond approvals. The higher asking prices of new residential developments have to compensate for the ever increasing professional and building costs and the fact that developers have to contribute to the upgrade of various infrastructures such as roads, water and electricity networks. This, coupled with high food inflation and increasing consumer debt levels, has made it far more difficult for citizens to purchase their first home. It is clear that home ownership is becoming a privilege for only a small percentage of South Africa’s population.
The rental market is also under pressure and has shown signs of strain over the past few months. However, most of our residential properties on offer are still being let - although it takes a bit longer to secure a qualified tenant.
We are excited to report that our new residential development Park Royal is now 75% sold out. The project will be completed and is scheduled for handover on 1 December 2016!
Author: Renico Construction
