19 Aug.
Residential building activity up in the first half of 2011.
The level of building activity in the South African housing market showed some improvement in the first six months of 2011 compared with the corresponding period in 2010. In the planning phase, the volume of building plans approved in the higherdensity category of flats and townhouses recorded strong growth. The construction phase of new housing also improved in the first half of the year, but at a slower pace than the planning phase, with a smaller number of new flats and townhouses built compared with a year ago.
The real value of plans approved for new residential buildings registered growth of 4,2% year-on-year (y/y), amounting to R9,15 billion in the period January to June 2011 (R8,77 billion in the same period last year). The real value of new residential buildings reported as completed in the first half of 2011 was down by 6,5% y/y to an amount of R6,73 billion, from R7,2 billion a year ago. These real values are calculated at constant 2005 prices.
Although the number of new housing units for which building plans were approved was up on a year-on-year basis in the first six months of 2011 (see table below), a decline occurred in the second quarter of the year, driven by lower volumes in the small-house segment, while the other two segments continued to grow. The total number of housing units for which plans were approved, came to 12 970 in the second quarter, down by 9,6% y/y from a total 14 346 units a year ago.
The volume of new housing units constructed was up by 2,5% y/y in the first half of 2011, after growing by a marginal 0,8% year-on-year in the second quarter of the year. The low growth recorded in the second quarter was largely impacted by a poor performance in the construction of new flats and townhouses, declining by 17,2% y/y in this period. A total number of 9 662 new housing units were constructed in the second quarter of the year compared with 9 590 units built in the same period last year.
Residential building activity in the rest of 2011 will continue to be driven by economic developments and the state of household finances, which will ultimately impact trends in the demand for and supply of new housing. …
Read more at Absa Property Research
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