Budget Comment from Sotheby's International Realty

Today’s Budget will do much to improve consumer sentiment and confidence following the disturbing events during the State of the Nation address earlier this month, says Lew Geffen, chairman of Sotheby’s International Realty in SA.

“We think Finance Minister Nhlanhla Nene has done an excellent job given the fact that he had so little room to manoeuvre on this Budget, and has managed to address most of the issues currently troubling most South Africans.

“For example, he has taken a tough stand on government wastage and tender fraud, and promised to save at least R25bn for the fiscus by implementing tighter controls.”

“At the same time, he has found more money for housing, schools, hospitals and especially for the improvement and repair of the outdated and inadequate infrastructure in our rapidly growing cities. This is all positive news for the property market, which is dependent on positive consumer sentiment, because it improves people’s experience of their living environments.”

Consumers will of course not be happy about the large increase in the fuel levy, Geffen says, because it will increase their cost of transport. “However it was probably the best option available, and better than a bigger increase in personal taxes or a hike in the VAT rate.

“What is more, it will also enable the Minister to give significant tax relief to small businesses, which are the real engines of job creation, and to raise the transfer duty threshold to R750 000, which will enable many more of the people who get jobs to afford their own homes.

“From our point of view, we are also very glad that the confusion over foreign buyers being allowed to acquire residential properties in SA has been cleared up, and believe that this, combined with today’s positive Budget, will do much to encourage much-needed private investment in SA.”

*originally published on the 25th of February 2015*