16 Apr 2013
The Standard Bank House Price Index showed growth of 9.2 percent year-on-year (y/y) in March from 6.6 percent y/y in February.
According to Sibusiso Gumbi, Standard Bank Home Loans analyst, the nominal index growth for freehold properties was 10.2 percent in March from 7.2 percent y/y in February, while the nominal index for sectional title units improved to 6.4 percent from 4.9 percent y/y in February.
Gumbi says the index by comparison had recorded growth below the 2012 metrics, averaging 5.5 percent y/y over the course of 2012.
He notes that subdued trends on the construction of new homes may possibly be emerging as a source of some upside pressure in the house price index.
According to the bank, the real value of new residential homes constructed improved slightly by 1.9 percent y/y in 2012 and in January 2013, 2 760 new residential units were constructed, a slight 87 unit decline on the 2 847 units constructed in January 2012.
Gumbi says while the majority of new residential units constructed in January 2013 were smaller freehold homes measuring less than 80 square metres, the number of flats and townhouses completed saw the most notable y/y growth (17.7 percent y/y in January).
He says the house price index is likely to post only single-digit growth in 2013.
Despite the gloom on house price growth, Rawson Property Group franchises in Melkbosstrand and Yzerfontein report that in the Cape West Coast, prices are now rising in a way not seen in five or six years.
David Evans, co-franchisee says in Melkbosstrand they sell five to six properties per month on average.
He says in one year, the average sales price of houses rose from R1.4 million to R1.53 million and their turnover in one year rose by 30 percent compared to the previous year.
“Any accurately priced home in this area sells in less than a month.”
Evans points out that in Melkbosstrand, it is still possible to buy property for R900 000 for a freehold home in a secure complex and up to R6 million or more for an upmarket sea-facing home.
In Yzerfontein y/y, the average prices have risen from just over R1 million to just over R1.3 million – an almost incredible 30 percent upswing, says Evans.
Furthermore, he says Yzerfontein always serves as a barometer with which to predict West Coast property trends.
“When conditions on the West Coast are tough, Yzerfontein prices plummet.
“Conversely, when they are improving, Yzerfontein is the first precinct to respond and it usually does so very dramatically, as the figures show only too well.”
Expect to pay from R250 000 to R3.5 million for a vacant plot and houses are priced from R995 000 to R7.4 million.
He predicts that house prices will continue to grow in the year ahead at 8 percent in Melkbosstrand and at least 12 percent in Yzerfontein.- Denise Mhlanga
Denise MhlangaProperty journalist at property24.com
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