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Johannesburg - The growth in house prices in the small, medium-sized and large categories for which Absa approved mortgage finance remained under pressure in May compared to a year ago, the bank said on Tuesday.
In the first five months, house prices showed an average nominal decline in the small and medium-sized categories, while all three segments recorded real price declines up to April, Absa's monthly house price index showed.
The declining trend in home values over the past few months was related to the slower nominal price growth, while the consumer price inflation has risen gradually during this period to a level of 4.2% in April.
In the small houses category, prices dropped by a nominal 6.4% year-on-year (y/y) in May this year from -4.7% y/y in April.
Absa property analyst Jacques du Toit said the base effect of a strong upward trend in price growth in this segment of the market a year ago was having a significant impact on current price growth.
The average price of a small house was about R755 400 in May. A real price decline of 8.6% y/y was recorded in the small house category in April.
The average value of medium-sized homes declined by 1.8% y/y in May this year, from 1.7% y/y lower in April, thus taking the price of a medium-sized house to about R955 500 in May, the data showed.
In real terms, home values in the medium-sized segment dropped by 5.7% y/y in April.
The segment for large houses saw nominal price growth of 1.8% y/y in May, down from 2% y/y in April. The average price of a large house came to R1.4m in May. A real price decline of 2.1% y/y occurred in the large segment in April.
Du Toit said the general state of consumer finances was continuing to affect the residential property market.
In the first five months, house prices showed an average nominal decline in the small and medium-sized categories, while all three segments recorded real price declines up to April, Absa's monthly house price index showed.
The declining trend in home values over the past few months was related to the slower nominal price growth, while the consumer price inflation has risen gradually during this period to a level of 4.2% in April.
In the small houses category, prices dropped by a nominal 6.4% year-on-year (y/y) in May this year from -4.7% y/y in April.
Absa property analyst Jacques du Toit said the base effect of a strong upward trend in price growth in this segment of the market a year ago was having a significant impact on current price growth.
The average price of a small house was about R755 400 in May. A real price decline of 8.6% y/y was recorded in the small house category in April.
The average value of medium-sized homes declined by 1.8% y/y in May this year, from 1.7% y/y lower in April, thus taking the price of a medium-sized house to about R955 500 in May, the data showed.
In real terms, home values in the medium-sized segment dropped by 5.7% y/y in April.
The segment for large houses saw nominal price growth of 1.8% y/y in May, down from 2% y/y in April. The average price of a large house came to R1.4m in May. A real price decline of 2.1% y/y occurred in the large segment in April.
Du Toit said the general state of consumer finances was continuing to affect the residential property market.
