Nominal property sales prices have shown a consistent rise over the years. The average sales price increased from just under R150,000 in 1994 to R1.4 million in 2023 - well above inflation, and an increase of more than 830%.
National year-on-year house price inflation currently stands at 3.22%, Lightstone pointed out.
On a provincial level, annual property inflation has remained steady in Eastern Cape and Western Cape.
It has, however, increased in Gauteng, North West, Northern Cape and KwaZulu-Natal, while it has decreased in the Free State, Limpopo, and Mpumalanga compared to the previous month.
Annual property inflation for the Low-Value segment has increased to 12.7%, while other value bands show a modest increase from last month. High Value properties saw a slight increase to 2.1%, Mid-Value properties to 3.5%, and Luxury properties also to 3.1%.
The residential property market in South Africa has witnessed a shift in the types of properties being developed and sold. Freehold properties remain dominant; however, Sectional Schemes and Estates are becoming increasingly popular.
This trend indicates a growing preference for gated communities and shared living spaces.
Despite the increasing overall stock, sales volumes have plateaued in recent years. In 2023, sales volumes were close to 208,000, slightly higher than the 190,000 recorded in 1994.
The property market saw its peak in 2006 and 2007, with over 320,000 sales each year. However, the 2007-2008 global financial crisis caused a sharp decline to 231,000 sales in 2008 and further down to just under 155,000.
A recovery was seen with nearly 238,000 sales in 2016, but the market dipped again to 197,000 sales in 2020 due to the impact of COVID-19.
A strong reaction in 2021 and 2022 led to a slight recovery, but by 2023, sales figures stabilized at just over 207,000.
The age of buyers and tenure of occupation before selling have also changed over the years. The financial crash of 2007/8 significantly impacted buyer behaviour, resulting in older buyers and extended tenures.
It also takes longer to sell a house in South Africa’s big five metros than it did 10 years ago – but it’s quickest in Cape Town and slowest in Johannesburg.
Lightstone has evaluated data from Estate Agents and found that the results show a steady increase in the time a property is on the market from 2014.
Overall, the average number of days on the market has risen from 69 in 2015 to 92 in 2024.
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