Real Estate & Economic News in South Africa from Propertyshowrooms.com

Western Cape house prices climb

Tue, 22 May 2012 00:00:00 GMT

The average price of buying a home in South Africa's Western Cape province increased in the first quarter of the year, compared to the same period in 2011.

SA Commercial Prop News reported on figures published by the Institute of Estate Agents of South Africa, which revealed the cost of purchasing a property in the region now stands at R 2,039,978 (£155,529). This is up from the R 1,938,267 average value recorded a year earlier.

Speaking to the publication, general manager of the Western Cape branch of the organisation Dianne Brock explained there are indications of an upturn in the South African real estate market.

"It has been noticed that South Africa lags the USA housing market by nine to 12 months - so the pick-up now being experienced there should be a positive sign for us," she commented.

Earlier this month, an increasing trend of foreigners purchasing homes in South Africa was highlighted, with the Western Cape named by Biz-Community as one of the destinations being targeted by British, French and German buyers.

South African house prices 'on the wane'

Mon, 23 Apr 2012 00:00:00 GMT

Those seeking property in South Africa may find they can get it for less as a new survey has indicated house prices are falling.

Absa Group has revealed the average value of homes in the country's housing market for which it received mortgage finance applications dropped 6.1 per cent in the year to February 2012 (when figures are adjusted for inflation).

This trend was seen in relation to small, medium and large homes, suggesting buyers can find less expensive properties in all categories.

According to Absa, higher running costs and the general economic situation in South Africa are responsible for the falls.

These include national inflation at 6.3 per cent and lower economic growth, expected to be 2.7 per cent this year after reaching 3.1 per cent in 2011.

Buyers may look for cheaper homes now in the expectation that values will rise in the long term.

Last month, research by Lloyds TSB International indicated the average home in the country rose by an average of 10.1 per cent each year over the past decade.

South Africa posts 'significant' house price growth

Wed, 21 Mar 2012 00:00:00 GMT

Over the past decade, the cost of buying real estate in South Africa has risen by 161 per cent in real terms.

This is the finding of research conducted by Lloyds TSB International, which noted the nation's residential property market experienced the third-highest gains during this period. Only Russia and India saw the value of homes climb by more.

According to the financial institution, these figures equate to an average annual increase of 10.1 per cent.

However, in the past year, house prices in South Africa have slipped by 1.1 per cent, the firm added.

There are other indications that the country's residential property sector may be undergoing a period of decline, with Global Property Guide highlighting rising inflation as a factor causing real estate values to slip.

In an article earlier this month, the publication pointed out that, despite house prices increasing by 2.3 per cent in nominal terms over the course of 2011, they actually fell by 2.6 per cent in real terms. Consumer price index inflation stood at 6.3 per cent in January, which was cited as the main reason for the overall fall in values.

South African house prices 'fall in real terms'

Wed, 7 Mar 2012 00:00:00 GMT

The value of residential property in South Africa declined in real terms over the course of 2011.

Global Property Guide explained that, despite the nation's house prices climbing by 2.3 per cent in nominal terms last year, they actually slid by 2.6 per cent in real terms.

According to the publication, this is largely down to rising inflation, which stood at 6.3 per cent for consumer prices in January 2012.

It added that, given the increase in inflation, predictions of house price rises in 2012 of between two and three per cent by the country's Absa bank may be optimistic.

Among the issues affecting South Africa's housing market are the nation's economic recovery, rising supply of properties with lower demand and a reduction in the level of investment in infrastructure projects.

Samuel Seeff, of Seeff Property Services, told the news provider the real estate sector has not ground to a halt.

"The [property] market is moving slowly and prices are under pressure, but there is still activity," he stated.

South Africa budget 'will boost property sector'

Mon, 27 Feb 2012 00:00:00 GMT

The latest budget to be unveiled by South Africa's finance minister Pravin Gordhan has been described by some commentators as a boost to the country's real estate market.

Chairman of Sotheby's International Realty in South Africa Lew Geffen highlighted the new housing subsidy scheme as one proposal that will have a quick impact on the sector.

"This will give the lower end of the market much-needed impetus and no doubt have a positive knock-on effect," he asserted.

Mr Geffen also praised the level of finance set aside for new infrastructure projects, noting it will create new jobs, as well as benefit the country as a whole.

Property economist professor Francois Viruly told Business Live spending on infrastructure will have a significant positive effect on South African real estate, stating this type of expenditure does more than simply support housing development, adding it also "plays a critical role in creating development and investment opportunities in cities and rural areas".

South Africa property prices up

Tue, 24 Jan 2012 00:00:00 GMT

The value of homes in South Africa climbed in December compared to a year earlier, it has been revealed.

Figures from the latest oobarometer - a measure of the performance of the South African property market by mortgage originator ooba - showed house prices increased by 6.2 per cent year-on-year last month.

A rise of 3.6 per cent was also recorded between November and December in 2011, the firm noted.

However, chief executive officer of the organisation Saul Geffen does not expect there to be significant increases in house prices this year.

"With the interest rate anticipated to remain low in 2012, and with property prices remaining depressed, the current market represents a favourable environment for buyers," he stated.

Earlier this month, home loan strategist for First National Bank John Loos predicted the residential real estate sector in South Africa would remain flat over the next 12 months.

He cited "strong supply relative to demand and a mediocre economic performance" as the main factors that are likely to hold the market back.

South African property market 'slowing down'

Wed, 11 Jan 2012 00:00:00 GMT

The value of real estate in South Africa is likely to fall by three per cent in real terms over the course of 2012, it has been predicted.

John Loos, household and property sector strategist at First National Bank (FNB), made the assertion after the FNB House Price Index revealed a "flattening out" of the residential market during 2011.

He explained the three per cent decline is based on consumer price inflation averaging at five per cent over the coming 12 months.

Mr Loos added forecasts of lower global economic growth than previously anticipated, as well as the expectation of only minimal interest rate cuts in South Africa in 2012, have weighed heavily on sentiment in the housing market.

In an interview with The New Age, property analyst at Absa Jacques du Toit agreed that the South African real estate sector will experience a difficult year.

He noted many consumers have been struggling with inflation, which will in turn have an impact on the property market.

South Africa property market 'to improve in 2012'

Mon, 9 Jan 2012 00:00:00 GMT

The property market in South Africa could be set for positive growth this year, an expert has said.

Speaking to property24, managing director of Anne Porter Knight Frank Lanice Steward said she had already seen increased interest in South African real estate from those attending events at show houses compared with 2011.

"The attendances at show houses are three or four times higher than the first half of last year," she remarked, adding that agreed sale prices are now matching up more with list prices, another indicator that the market is beginning to get back on an even keel.

Chairman of property real estate firm RE/MAX's Southern Africa division, Peter Gilmour, commented last year that the country is unlikely to see lows or highs in 2012 in terms of its property market, which he expects to continue along its current steady course.

South African bond originator ooba also recently highlighted that property prices in the nation showed year-on-year growth in November 2011 for the first time since August of the same year.

Positive outlook for South African property sector

Wed, 30 Nov 2011 00:00:00 GMT

Despite still facing challenges, the property market in South Africa is performing better than some of its counterparts elsewhere in the world.

This is the opinion of Tony Clarke, managing director of Rawson Properties, who recently attended the National Association of Realtors (NAR) annual conference in the US.

In an article for SA Commercial Prop News, he stated that after attending the event, it has "become clear to me that the South African real estate sector is coming through bad times less damaged than that of the USA".

Mr Clarke cited several challenges that lie ahead for the property industry in his nation, including a loss of confidence in the market and lower mortgage approval rates.

However, he noted in the publication that house prices in South Africa are rising at a level that almost matches inflation, which paints a more positive picture for the country going forward.

Earlier this month, Berry Everitt, managing director of the Chas Everitt International Property Group, highlighted the influx of foreign buyers in South Africa's real estate sector.

He commented that economic growth and a stable banking system have helped international investors view the nation as a safe haven and therefore a good location to buy a home.

Fewer foreigners buying South African property

Fri, 5 Aug 2011 00:00:00 GMT

The number of foreign nationals investing in a property in South Africa (SA) has fallen, the latest figures from the country's First National Bank (FNB) show.

According to the FNB Estate Agent Survey for the second quarter of the year, the percentage of real estate transactions carried out by those from overseas was just three per cent of total residential buying.

This is compared to a high of seven per cent that was experienced back in 2005, FNB home loans strategist John Loos commented.

However, Mr Loos stated: "We don't believe that poor sentiment towards SA is currently a key issue. Rather, weak foreign buying is more likely related to [...] a deterioration in sentiment towards the property asset class globally."

Last month, the FNB published its report into the state of the SA rental market in the first half of 2011 and noted that the sector has marginally improved since 2010.

The organisation added that there is likely to be greater demand for rental properties among homeowners forced to sell due to financial pressures over the coming months.

South African real estate market 'expected to improve'

Mon, 25 Jul 2011 00:00:00 GMT

Activity in the South African residential property sector is expected to pick up, according to one expert.

In an article for Real Estate Web, Andrew Golding, chief executive of the Pam Golding Property Group, stated that the outlook for the coming six to nine months is "cautiously optimistic".

"While the housing market has plateaued and is to some extent in the doldrums, recent activity indicates an upward trend both in regard to the number of units sold and in terms of pricing," he commented.

Mr Golding added that this week's decision by the country's Monetary Policy Commission (MPC) to leave the repo rate unchanged at 5.5 per cent was a welcome one for the property sector.

The South African Central Bank last cut its rates in November 2010, bringing them to this historic low, which it has since maintained.

MPC governor Gill Marcus described the nation's domestic recovery as "fragile", adding that problems in the eurozone economies could pose a further risk to any economic growth prospects.

South African property prices up in June

Tue, 12 Jul 2011 00:00:00 GMT

Prices for properties in South Africa saw an annual rise in June, according to new figures.

Statistics from Standard Bank show house values increased by three per cent compared with the same month in 2010, I-Net Bridge reports.

Property prices had risen by 3.3 per cent in May, but month-on-month there was no uplift in June - despite the fact that interest rates have been low for some time.

Sibusiso Gumbi, analyst at Standard Bank, said the property market is seeing slow growth partly as a result of restricted credit, low employment and increasing energy and food costs.

However, the expert noted that the South African economy as a whole is starting to experience positive movements in indicators such as consumer incomes and spending.

Investors may also be able to benefit from rising prices in the commercial real estate sector this year.

The most recent SAPOA/IPD South Africa Property Index revealed that total returns from this type of investment stood at 13.3 per cent in 2010, up from 8.8 per cent in the previous year.

IPD South Africa managing director Stan Garrun said: "The investment property market is undergoing a sustainable, though drawn out, recovery."

Prices continue to climb in South Africa

Wed, 20 Apr 2011 00:00:00 GMT

South African property prices saw positive value growth during March, the latest figures from ooba have revealed.

The country's leading bond originator reported that the price of residential property climbed by 1.1 per cent over the course of the month, compared to the previous year.

It means that the average cost of a new home in South Africa now stands at R860,492, up from R850,864 a year previous.

According to Saul Geffen, chief executive officer of ooba, the results are both positive and surprising.

"Given the high levels of growth experienced in the first half of last year and the negative growth recorded for the last consecutive four months, we did not expect prices to return to positive territory so quickly.

"We will have to wait until next month to see whether this is an anomaly or a return to positive price growth."

Mr Geffen added that he expected the positive growth to continue with all the necessary components needed for market growth in place.

South African property prices set for further falls in 2011

Thu, 17 Feb 2011 00:00:00 GMT

Residential property prices in South Africa are expected to fall this year largely as a result of weak demand and a struggling economy.

According to the January 2011 FNB House Price Index report, there was an average decline of 1.3 per cent over the month, with average prices now standing at R568,000 (£48,500).

It is likely that the news will be welcomed by those hoping to buy property in South Africa, with the average price set to decline even further over the coming months.

"The slowing year-on-year growth rate in the average house price remains largely driven by weak demand growth, which in turn is the result of, firstly, a weak economy and its constraining effect on household income growth and, secondly, the high levels of household debt relative to disposable income," the report said,

In addition, strong residential supply, overhang from the building boom of a few years ago as well as high levels of financial pressure are also playing a role in the price falls.

Distressed sales leading the way in South Africa

Thu, 30 Sep 2010 00:00:00 GMT

Investors looking for property in South Africa should act now if they want to get hold of a bargain, it has been claimed.

Personal Finance South Africa has highlighted the fact that a record number of homeowners are now opting for distressed sales or putting their homes on the market through "sales in execution".

Anthony Miller, managing director of property evaluation company Lightstone, told the news provider that distressed-sale properties are being sold at a discount of between 30 per cent and 50 per cent below market value.

"These are great times if you are looking for bargains in the property market," Mr Miller added.

"Annual house prices in the affordable market grew 14 per cent year-on-year, which is above the seven per cent to nine per cent growth the other market segments saw in the last year."

The news may interest individuals looking at province of the Western Cape property, with the area having recently held a number of World Cup matches.

South African property prices continuing to rise

Thu, 2 Sep 2010 00:00:00 GMT

Mid-range South African property prices continued to rise on a year-on-year basis in July, increasing by 7.6 per cent, according to figures from the Absa House Price Index.

However, the rate of growth was at a slower pace than in previous months, suggesting that prices may be reaching their peak after a 7.7 per cent rise in June.

Year-on-year growth in value for large properties also rose by 4.7 per cent, following growth of 5.5 per cent in June.

According to the bank, house price growth in South Africa is likely to slow in the later months of the year as interest rates are expected to stay static.

"Year-on-year house price growth is forecast to slow down further in the months towards year-end, largely driven by the base effect of a recovery in property prices in the second half of 2009. Real house price growth in the rest of the year will be determined by nominal price trends as well as the course of consumer price inflation," it stated.

In June, data from the Lew Geffen Sotheby's International Realty website highlighted that British and European property investors' interest in South Africa remains strong, with traffic from UK residents to the site increasing 23 per cent.

South Africa holds interest rates

Thu, 19 Nov 2009 00:00:00 GMT

There will be no interest rate rise in South Africa this month, it has been announced.

In its monthly meeting, the country's Monetary Policy Committee (MPC) said it was maintaining the repurchase rate at seven per cent, something that may be good news for those keen on buying property in the country.

Such a move comes as the inflation rate fell from 6.4 per cent in August to 6.1 per cent in September.

The MPC added that the projection for inflation is that it will go on dropping, with this falling within its target range in the opening quarter of 2010.

It said: "There are no major demand side pressures on inflation and the assessment of the committee is that there are no significant upside risks to the inflation outlook emanating from this source."

Such a comment would suggest that the prospect for further rate rises is small and there may instead be scope for cuts.

South Africa is a particularly good golf property destination with its 138 international standard courses, the Daily Mail reported earlier this month.

South African property 'bouncing back'

Wed, 4 Nov 2009 00:00:00 GMT

The South African property market is bouncing back from a spell in the doldrums, it has been stated.

Overseas real estate magazine Property Abroad has said the country has seen a 40 per cent increase in sales in the past two months, compared to the previous equivalent period.

It suggested that the return of a widespread provision of 100 per cent mortgages to the market is helping this recovery to take place and said that Cape Town could be a particular beneficiary of the rebound.

Both the Cape and the country as a whole could gain from the attention focused on it by next year's World Cup, the portal suggested, labelling South Africa as "very much the world's underestimated emerging market".

The country can offer some very favourable upmarket homes, chairman of Sotheby's International Realty SA Lew Geffen told the Times Online last month.

He said that for the price of a one-bedroom apartment in London, a buyer could pick up a three-bed beachfront property in the Sea Point area of Cape Town.

Cape Town tipped to bottom out

Wed, 14 Oct 2009 00:00:00 GMT

Cape Town could be the best place to invest in property in South Africa, a real estate expert there has argued.

Writing for South African property site Real Estate Web, chief executive of Durr Estates Julian Reynolds noted that the city has seen the largest price falls of any metropolitan area in the country, with 91 per cent of homes sold below asking amounts in the second quarter.

However, he added: "With prices expected to bottom out over the next few months, the potential upside for the Cape property market exceeds that of other provinces."

Mr Reynolds said the city will be aided by its tourist popularity and by the particular focus that will be placed on it as a host city in next year's World Cup, which may help stimulate more property investment.

Last month, the Knight Frank Global House Price Index indicated that during the second quarter of 2009 prices in South Africa dropped by 1.4 per cent.

This was an improvement on the 1.8 per cent dip in the opening three months of the year, suggesting the downturn in the property sector has been losing momentum.

South Africa property decline 'easing'

Sat, 12 Sep 2009 00:00:00 GMT

South African property prices declined in the second quarter of 2009, but by less than in the previous three months, new figures have indicated.

According to the Knight Frank Global House Price Index, prices dipped by 1.4 per cent in the second quarter.

However, this was less than the fall of 1.8 per cent in the three months to March, which may have marked the peak of the decline after a 0.7 per cent dip in the last quarter of 2008.

Such findings might suggest the bottom of the market in South Africa has been nearing over the summer.

And prices may now be rising there, with the latest First National Bank house price index recording a 1.8 per cent increase in July.

Thousands of Britons may become interested in buying in South Africa after visiting the country during the next year for major sporting events.

The England cricket team tours there this winter, while the football squad guaranteed their qualification for next year's World Cup by beating Croatia this week.

Resignations shake up SA markets

Wed, 24 Sep 2008 00:00:00 GMT

South African stock market traders are bracing themselves for further falls after finance minister Trevor Manuel's resignation this week...

Tourism industry 'largely untapped'

Wed, 13 Aug 2008 00:00:00 GMT

The number of people working in the tourism industry reportedly needs to grow by tens of thousands to satisfy the demands of 2010...

Australian property 'popular with South African investors'

Thu, 7 Aug 2008 00:00:00 GMT

A growing number of overseas property investors in South Africa are showing interest in the Australian market, according to experts.

Estate agency Pam Golding Properties stated that the country is proving to be a popular choice with prospective purchasers of real estate in South Africa, reports Cape Argus.

Simon Gibb, spokesperson for the company, said much of the interest is coming from people who plan to buy for investment purposes.

However, he stated that some enquiries are also coming from people who wish to live in Australia on a permanent basis.

Mr Gibb believes the decline in the South African currency, as well as growing political uncertainty, has fuelled the recent interest in buying abroad.

He commented: "There is a trend that when our rand is trading less favourably against the major currencies, South Africans look to move money offshore.".

Earlier this week, Paul Arthur of The Emigration Group told the Daily Star that Australia has attracted 23,906 expats from the UK in the last year.

Tourism industry feels cash crunch

Wed, 30 Jul 2008 00:00:00 GMT

Tourists are still coming to South Africa, but now they are spending billions of rands less than they did before...

South African expansion for AIM-listed investor

Tue, 29 Jul 2008 00:00:00 GMT

South African Property Opportunities (SAPRO), the AIM-listed investor, has sold its 27 acre retail element of its African Renaissance Development...

KZN tourism feels the economic pinch

Thu, 24 Jul 2008 00:00:00 GMT

The KwaZulu-Natal tourism and hospitality industry has taken a hammering...

South African office rents to grow

Tue, 26 Jun 2007 00:00:00 GMT

Rents within the South African office sector are set to see double digit growth this year, according to one financial firm.

In its latest annual report, Vukile claimed that sustained levels of economic growth in recent months and favourable conditions within the commercial property market could see rents increase significantly.

However, in a joint statement, the company's chairman Anton Botha and chief executive Gerhard van Zyl said that rising building costs could potentially have a negative impact upon the market.

"Significant infrastructural expenditure on such developments as the World Cup, the Gautrain and the Coega IDZ will place further pressure on building costs in the year ahead," they stated.

A-grade building costs are likely to require rents that are above the current average rate, they added.

Earlier in the month, Business Day reported that median price growth within the country's residential property market reached 10.9 per cent in May.