Real Estate Investor Magazine South Africa October 2015 | Page 38

ACQUIRING

SA Property
year in review

The local property market performance through 2015
BY DR ANDREW GOLDING

A

lthough national house price growth currently
reflects a gradual and modest easing – while
still remaining ahead of inflation, the past year
has seen a robust residential property market maintain
its ongoing resilience despite South Africa’s sluggish
economy and other global economic impacts.
There are a number of trends, which characterise
this period, with some still very much in evidence as
we reach Q4 in 2015. First and foremost this includes
a shortage of stock and an abundance of homebuyers
– particularly in major centres, commercial hubs and
other high demand areas around the country.
This is along with a strong rental demand across
the board, with every segment of the market active
and experiencing a shortage of rental stock, with
an oversupply of would-be tenants and as a result,
increasing rental yields.
As is the case globally, densification and urbanisation
are becoming increasingly evident as households move
to economic nodes along public transport corridors
to avoid traffic congestion and young professionals
gravitate towards city centres. This is accompanied
by the continued trend towards a desired ‘live, work,
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OCTOBER 2015 SA Real Estate Investor

play’ lifestyle, as seen in examples such as Melrose
Arch, Steyn City and Park Central in Gauteng, Cape
Town’s vibrant central city and the Gateway precinct in
uMhlanga in KwaZulu-Natal.
House prices within the country’s major metropolitan
areas continue to good capital growth, registering
healthy growth rates with pockets of excellence such as
Cape Town Metro which has experienced house price
growth in excess of 20 percent over the past year to date.
Limited land availability within these areas, combined
with rapid urbanisation and migration between metros
– with a steady influx of people seeking economic
opportunities, are contributing to a steady increase in
metro house prices.
An exponentially increasing aspiration among home
owners to seek residences with lower overheads and
energy-saving features in order to reduce utility and
other monthly costs has seen the demand for sectional
title units ie apartments and townhouses, grow in
comparison to freehold properties. Confirming the
national trend towards downsizing to more manageable
homes, the number of flats and townhouses built
has also risen, brought to market by developers who
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