[I have mentioned before, that the so-called “boom” in S.Africa is really all about property, where property prices exploded over the last 5 years.

I have mentioned too, that a friend of mine who is a property valuer said that property prices in S.Africa move in a 5 year cycle. This cycle started in 2000, and its coming to an end. I’ve seen internal company figures which are not released to the public, and as far back as a year ago, one could see things slowing down.

This evening on eTV news they had a story where they said that the property boom is now coming to an end. Properties are still being sold, but much more slowly. Prices are not rising much any more, etc.

An economist said that the property boom is now coming to an end.

This property boom has been misrepresented, especially in the USA, as being a fantastic economic boom… which it was not. This boom will not only come to an end, but you will see how many people will yet lose their homes when the interest rates go up.

Lots of people here got into excessive debt. S.Africans are now deeper in debt than ever in history. So wait for the interest rates to go up, and watch to see how many people are going to come crashing down. Our interest rates now are round about 10%(43)+. But many of us have also seen interest rates in S.Africa, of over 20% in the past. If our interest rates go up much more, you will see serious problems and large numbers defaulting on property purchases.

Actually, it gets even worse than that. The banks have also encouraged people to buy cars, go on holidays, etc – all of this financed by their home loans. You get a situation where a person’s entire debt is all rolled into one huge account and propped up by their homeloan. So… when this baby comes crashing down, some people might not just lose their houses, but their cars, and perhaps a lot of other things too! Jan]