South African consumers could be getting a break

Jul 17, 2018 8:39:58 PM

We welcome the announcement by President Cyril Ramaphosa that Government will in two weeks’ time announce a package of economic measures to cushion the public from the devastating effects of high fuel price hikes and the VAT increase.

"As salaries are usually only increased annually, the consumer has to juggle unforeseeable market fluctuations on a perpetual basis, making it very difficult to adhere to a budget and plan investments,” says Gray. Richard Gray, Harcourts Africa Chief Executive Officer, says according to media reports, Ramaphosa was addressing business and government leaders in Pretoria ahead of the BRICS Summit this month. The President said a panel of various stakeholders from the economic cluster has been tasked with drafting the package. “It is an immediate necessity that consumer pressures on South Africans be addressed in a strategic and detailed plan. Therefore it is a welcome relief that president Ramaphosa said Government will be announcing a package of measures to ease the burden of the price increase, which will include the finalisation of the VAT-exempt products,” says Gray.

“The continuous rise of expenses on South Africans has led to many people stagnant in a consumer price pinch. We have certainly witnessed it in the property sector, with some locations slowing down completely as buyers turn to renting as a means to bide time and monitor the economic climate.”

He says even in high LSM markets the property market has slowed down. Analysing properties sold for the last 12 months (April 2017 to March 2018) along the Atlantic Seaboard registered with the Deeds Office, which includes both sectional and full titles, the region has undoubtedly experienced a cooling period after the drastic growth of the past few years.

“Unfortunately, consumers are directly impacted by tax increases due to our participation in a multitude of industries. We’re economically active, and as purchasers of an array of products and services we feel the knock-on effects of the suppliers who have to make changes in order to buffer the impact on their businesses,” says Gray.

“The rise of fuel costs as well as the increase in VAT has undoubtedly put pressure on the man on the street. As salaries are usually only increased annually, the consumer has to juggle unforeseeable market fluctuations on a perpetual basis, making it very difficult to adhere to a budget and plan investments.”

Topics: Richard Gray, Harcourts South Africa, President Ramaphosa, South African Markets, South African Consumers