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Johannesburg - The Western Cape seems to be the only one of the big four provinces that does not find itself with more repeat buyers of property leaving than the number moving in.
This might not bode well for the future economic growth of Gauteng, KZN and the Eastern Cape, according to John Loos, household and property sector strategist at FNB.
"This should not come as too much of a surprise," said Loos.
"The Western Cape's economy is the second largest in South Africa after Gauteng and has also boasted the second highest growth rate slightly behind that of Gauteng in recent years."
In addition, Cape Town and surrounding areas has the benefit of a perceived high quality lifestyle compared to many other of SA’s cities, according to FNB's latest research on interprovincial repeat home buyer migration patterns.
"It is this combination of good economic opportunity along with lifestyle that appears to be proving to be the winning recipe in attracting both wealth and skills to the province in relatively abundant quantities," said Loos.
"Over the long term, therefore, it would appear that household mobility is rising and that a greater portion of households relocate to more far off destinations, predominantly for work purposes."
The inter-provincial repeat buyer migration picture shows a similar picture in 2012 compared with 2011.
In terms of total inter-provincial repeat buyer migration, 2012 was another slow growth year, measuring 3.1%, down from 2011’s 4.8%.
This second year of slowing growth is in line with a recent economic growth slowdown which constrains employment growth and thus labour mobility.
As a percentage of total repeat buying, interprovincial repeat buying continued to rise in importance to 18.7%. This is now well higher than 13.8% at the turn of the century back in 2000.
"Given that many people vote with their feet, studying migration patterns between regions in South Africa can provide a good indication of household perceptions towards regions, perceptions of economic opportunity, lifestyle or other factors," said Loos.
"However, we believe that these provinces still have a competitive advantage over the five smaller provinces, despite not showing noticeably better net migration rates than the small five."
This is because a higher percentage of departures of repeat buyers from the larger economic centres are for non-work related reasons like retirement and lifestyle.
This is especially so in the case of Gauteng which, according to the FNB Estate Agent Survey, has a significantly lower percentage of departees doing so for work-related purposes.
This suggests that Gauteng loses less active skilled labour than may meet the eye.
According to Loos it is believed that the larger economic centres, especially Gauteng, benefit more from inward migration of aspirant first time buyers in the early stages of their working life, than do the smaller provinces.
"And so we find that net migration rates don’t correlate that strongly to longer term economic growth performances," he said.
"Rather, gross outward migration rates of repeat buyers appear to be better correlated to economic growth."
He said this should perhaps concern policymakers, because while skilled labour outflows are probably caused by relatively weak economic performance, they can also sustain weak regional management and economic performance in the smaller economic regions.
- Fin24
This might not bode well for the future economic growth of Gauteng, KZN and the Eastern Cape, according to John Loos, household and property sector strategist at FNB.
"This should not come as too much of a surprise," said Loos.
"The Western Cape's economy is the second largest in South Africa after Gauteng and has also boasted the second highest growth rate slightly behind that of Gauteng in recent years."
In addition, Cape Town and surrounding areas has the benefit of a perceived high quality lifestyle compared to many other of SA’s cities, according to FNB's latest research on interprovincial repeat home buyer migration patterns.
"It is this combination of good economic opportunity along with lifestyle that appears to be proving to be the winning recipe in attracting both wealth and skills to the province in relatively abundant quantities," said Loos.
"Over the long term, therefore, it would appear that household mobility is rising and that a greater portion of households relocate to more far off destinations, predominantly for work purposes."
The inter-provincial repeat buyer migration picture shows a similar picture in 2012 compared with 2011.
In terms of total inter-provincial repeat buyer migration, 2012 was another slow growth year, measuring 3.1%, down from 2011’s 4.8%.
This second year of slowing growth is in line with a recent economic growth slowdown which constrains employment growth and thus labour mobility.
As a percentage of total repeat buying, interprovincial repeat buying continued to rise in importance to 18.7%. This is now well higher than 13.8% at the turn of the century back in 2000.
"Given that many people vote with their feet, studying migration patterns between regions in South Africa can provide a good indication of household perceptions towards regions, perceptions of economic opportunity, lifestyle or other factors," said Loos.
"However, we believe that these provinces still have a competitive advantage over the five smaller provinces, despite not showing noticeably better net migration rates than the small five."
This is because a higher percentage of departures of repeat buyers from the larger economic centres are for non-work related reasons like retirement and lifestyle.
This is especially so in the case of Gauteng which, according to the FNB Estate Agent Survey, has a significantly lower percentage of departees doing so for work-related purposes.
This suggests that Gauteng loses less active skilled labour than may meet the eye.
According to Loos it is believed that the larger economic centres, especially Gauteng, benefit more from inward migration of aspirant first time buyers in the early stages of their working life, than do the smaller provinces.
"And so we find that net migration rates don’t correlate that strongly to longer term economic growth performances," he said.
"Rather, gross outward migration rates of repeat buyers appear to be better correlated to economic growth."
He said this should perhaps concern policymakers, because while skilled labour outflows are probably caused by relatively weak economic performance, they can also sustain weak regional management and economic performance in the smaller economic regions.
- Fin24
