Based on the latest survey on house price statistics by the Global Property Guide, the property market in South Africa is gradually becoming stable although the slow growth. The price index of the medium sized apartments in the country are seen to be increased by 0.2% since years which is rather lower than the annual growth rate of 2.86% in Q1 and 3.33% in Q4 2012.
Since the global financial crisis have started, the price of the houses in South Africa have turned down to 15.5%. This situation was observed in Q4 2007 and Q2 2009. However a recovery had begun in 2010, but it was only for a while with the prices being fallen to 7% between Q1 2011 and Q2 2012.
However the situation was expected to be stable as the total mortgages increased by 1.8% year on year in July 2013 as a result of many people entering the market. The mortgages values stood ZAR 1.1 trillion (£7 billion approx) in July, based on the figures from the SA Reserve Bank.
The same situation is also seen in the construction sector. The number of residential building plans approved increasing 10.4% year on year to 25,512 in the first half of 2013, according to the figures from Statistics South Africa. The number of building completions also hiked by 5.2% to 20,876.
This ongoing stability is being supported by the growing economy as said by the Global Property Guide. It is expected to be increased by 2.4% this year and 3.5% in 2014. The economy was able to increase by 3% quarter-on-quarter in Q2 as the central bank kept the interest rates on hold at 5%.
Dries du Toit, financial consultant and former chief investment officer of Sanlam Investment Management, believes that investing in the South African property and real estate is the perfect way to move further. He further explained that since last 10 years 90% of the asset managers have missed out the returns of 20% or even more by not taking into consideration the South African property segment- reported by the Independent Online.
