14 Nov 2012
House prices between different segments of the market had seen a general narrowing in the gaps in the third quarter of 2012, according to FNB housing data released on Wednesday.
"The average price growth rate of full title homes, at 6.7 percent year-on-year, no longer far exceeds the 4 percent growth for sectional title homes, as was the case a few quarters ago," John Loos, property strategist at FNB said.
Sectional title refers to separate ownership of units or sections within a complex or development.
Full title segment is where the consumer buys the ownership rights of the property and the land on which it is built.
It was expected that the various segments' price growth rates will move increasingly closer to each other in the near term, with relative affordability advantages having been reduced over the past few years.
At stages during the pre-2008 house price boom, the average price of a three-bedroom sectional title home was in excess of 20 percent higher than the average for a three-bedroom full title home.
The gap was still very significant as at 2009, just after the recession.
"However, thereafter this gap has steadily narrowed to a virtually insignificant 0.6 percent, as full title house price growth has exceeded sectional title price growth in recent years."
Loos said the full title market's affordability advantage that was built up in the boom period had probably come to an end.
From a price affordability point of view there was no longer much of an advantage in buying a three-bedroom full title home compared to a three-bedroom sectional title home.
"The average price gap in this segment has virtually disappeared as a result of superior full title house price growth over the past few years."
The percentage by which the average sectional title two-bedroom price exceeded that of two-bedroom full title had also significantly reduced.
The four-bedroom sectional title average values were back below average four-bedroom full title values since late-2009. - Sapa
Apartment / Flat for sale in De Waterkant R 2 950 000
House for sale in Pimville & Ext R 690 000
House for sale in Noordheuwel R 1 195 000
House for sale in Birchleigh R 9 500 000
Commercial Property for sale in City Bowl R 6 300 000
Vacant Land / Plot for sale in Zevenwacht R 929 250
Townhouse for sale in Amanzimtoti R 1 320 000
House for sale in Soshanguve East R 329 000
House for sale in Annlin R 740 000
House for sale in Annlin R 1 380 000
If you are using Internet Explorer 8 or higher, please verify that your Internet Explorer compatibility view settings are not enabled.
For the best browsing experience update to the latest Version of Internet Explorer or try out Google Chrome or Mozilla Firefox.
Please contact our Customer Service Centre for further assistance. Tel. +27 (0)861 111 724