MAIN IMAGE: Troy Oakley – Nedbank head of sales in KwaZulu-Natal
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Career banker Troy Oakley started as a sales consultant at Nedbank 27 years ago. He joined the Home Loan division in 2005 as the regional manager for the coastal region. For the past 17 years, he has been the head of sales in KZN, overseeing sales performance across the province.
Several articles recently indicated that the residential property market in KZN is picking up. In this Q&A, Oakley shares his insight.
Can you give us some background about the KZN property market?
Over the extensive length of time in the role, I have seen many events and changes taking place, both in the property market and in the banking financial sector. The property boom, which started in 2000, peaked in 2004 and ended in 2006 with average returns exceeding 20%. The National Credit Act was implemented in mid-2007 to protect borrowers from over-indebtedness. The global financial crisis in 2008 and 2009 saw property prices dropping into a negative growth spiral.
The property market started to recover in 2010 after SA hosted the FIFA World Cup. Since then, we have seen moderate property price growth within single digits, which is not flattering when you adjust for inflation. KZN has faced many challenges recently, from devastating floods to major civil unrest, which resulted in mass looting across the province. Over the past 3 years, KZN has been grappling with high interest rates, political instability, and infrastructure backlog, but green shoots are showing, and there is an air of positivity in all areas in the province, with a renewed interest in property investment.
Could you share a bit about some of the mortgage products and offerings you have available for buyers?
The property financing market is very competitive, and as one of the bigger financial institutions, I believe it is important to listen to your customers’ needs and solve their pain points. To stay relevant in the market, we need to stay innovative and in a position to meet the ever-changing market demands.
As a bank, we try to create value for our clients on mortgage products. For example, to assist 1st time home buyers in getting onto the property ladder, we offer finance that includes a home loan of up to 109% for bond and legal costs on your first home. The Home Vision offering allows for the registration of a bond that is higher than the current value of the property in order to have access to surplus capital for alterations or use in the future, just to mention a few.
The KZN residential property market has suffered several knocks over the last few years (from riots to floods and the high repo rate). Can you give us a snapshot of what’s happening in the market now?
I think the interest rate drop of 0.25% we have just seen and the predicted downward trend will relieve consumers and improve movement in the property market. Current political reforms and infrastructure spending in the province will also drive a revitalised property landscape. Consumer confidence is growing in the province, and this will have a positive knock-on effect.
Which areas are showing the most growth, and why?
It is difficult to isolate which areas are showing the most growth as there are factors driving all area growth. Urbanisation remains a significant driver of the KZN property market. Ballito and surrounding areas are currently seen as one of the fastest growing areas due to the coastal lifestyle, proximity to Durban and the King Shaka International Airport, top-tier schools, premium estate living, and abundant family-friendly facilities.
The KZN North Coast is thriving as more people move there. We cannot overlook the upper highway region, where secure estate living and commercialisation drive property demand in areas such as Kloof, Hillcrest and Waterfall. Umhlanga remains a hot tourist spot and commercial centre, seeing an increase in apartment living.
Have you noticed any semigration taking place from Gauteng, further inland?
There has always been a semigration of people from Gauteng to Durban, but this has not increased over the years. We find younger people moving from KZN to Gauteng seeking better job opportunities. The riots, coupled with the infrastructure concerns, particularly around water shedding and wastewater issues causing E.coli contamination on the beaches, and the poor services rendered by the local council have resulted in many residents semi-grating to the Cape. Parents are also encouraging their children to study in the Cape.
What is your prediction for the property market in KZN? What can we expect in the next five to ten years? I think we will see a far more positive sentiment in KZN, with substantial growth in the areas where the local municipalities deliver on service and infrastructure.
