PUBLISHED 12 FEB 2010
The national average house price rose by a
nominal 4,7% year-on-year to R1 006 300 in November, after increasing
by a revised 3,4% y/y in October, according to the latest Absa figures.
Janine Barry of the SA Property Club notes, however, that the average
prices of both small and medium-size houses were still showing a
nominal decline in that month. According to Absa, the average price of
small houses (80-140sqm) showed a nominal 1,7% decline y/y to R665 100,
and the average price of medium-size houses (141-220sqm) fell by 3,3%
y/y to around R916 900.
But the average price of large houses (221-400sqm) increased by a
nominal 3,5% y/y to R1 419 700, pushing the national average over R1m.
The Absa figures also show that, after adjustment for the effect of
inflation, house prices continued to decline in real terms up to
October, but that the pace of this deflation was slowing down. Small
houses showed a 7,7% y/y drop in October, following a 8,6% y/y decline
in September. The average price of medium-size houses was 9,2% down y/y
in October, compared to 9,6% down y/y in September. And the price of
large houses was only 2,8% down y/y in October, from a 3,5% decline y/y
in September.
In fact, says Graham Leslie, MD of Greeff Properties, this shows that all homes have moved into a growth phase.
"And although this growth does not yet match the inflation rate, it is
encouraging to see that the lengthy period in which homes steadily lost
value has now apparently ended.”
The ABSA report, he adds, predicts that, if the current trend
continues, a 5% overall growth rate on residential property can be
expected in 2010.
"However, even though Cape houses are coming off a higher base, Greeff
Properties estimates that an 8% growth rate in Cape property values
will be achieved this year.
"This should encourage property watchers to buy now, because if they
leave it to the middle of the year, they could well have to pay up to
5% more than current values."
Source: Property Trader
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