Will new visa regulations affect the property market?
PUBLISHED 28 AUG 2015
South Africa's new visa requirements for visitors entering the country have been detrimental to the tourism industry. Will they affect the property industry too?
South Africa's new visa requirements as well as the documentation required for children entering this country have caused a fair amount of panic - and for good reason. The number of international tourists visiting our shores has dropped significantly since the new legislation was introduced earlier this year.
Although the Minister of Home Affairs, Malusi Gigaba is adamant that the strict regulations will stay in place, it appears that someone in Government is listening and the recent announcement by President Zumba Jacob Zuma of a ministerial review of the controversial new requirements has undoubtedly seen tourism stakeholders breathe a sigh of relief. And it's not the only sector that should appreciate the investigation.
Ronald Ennik, CEO Ennik Estates, says the residential property sector should also welcome the review.
“The President’s announcement follows the welcome news last week of a Cabinet-appointed task team to assess the harmful impact of the controversial new requirements on tourism,” he says.
He notes that tourism has always been the biggest propellant of foreign direct investment in South African residential property, and points out that 28 percent of South African homes sold for R20-million or more were reportedly bought by foreign investors.
“However, since the Home Affairs requirements for unabridged birth certificates and biometric visas began to bite towards the end of last year, South Africa’s Tourism Index has plunged to its lowest level since 2011.
Put another way, in the first quarter of 2015, South Africa lost 150 000 international visitors (all potential residential property buyers) together with their R1,6-billion in direct spending power compared with the corresponding quarter in 2014.