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Johannesburg - The property market appears to be strengthening after a "lull" in the residential sector in the first half of 2014, First National Bank said on Tuesday.
The FNB Estate Agent Survey's activity level ratings suggested that 2015 would see a broadly strengthening market, said FNB household and property sector strategist John Loos.
"However, stock constraints remain significant, albeit possibly diminishing slightly, and one point for minor concern is the apparent perception by agents that residential affordability may just be in the early stages of deterioration," he said.
Loos said the fourth quarter 2014 Residential Activity Indicator saw a slight slowing, from 6.63 previously, to 6.61.
However, a seasonally-adjusted version of the indicator showed activity rising from 6.48 in the second quarter of last year to 6.62 in the third quarter, and then rising further to 6.8 in the final quarter of last year, he said.
"Therefore, it would appear that we head into 2015 with the residential market still on a broadly strengthening activity trend."
Estate agents cited significant stock constraints in the fourth quarter of 2014.
He said the survey showed no "meaningful change" in seller price realism.
Loos said that agents had reported seeing residential affordability starting to deteriorate in 2014, after years of improvement.
"The percentage of agents believing that 'income levels have kept up with prices' has declined, from 49% in the second quarter, to 41% and then 39% for the third and fourth quarters respectively," he said.
"When agents indicate the factors influencing their near term expectations, excluding seasonal factors, we continue to see the significance of stock constraints (lack of stock available to sell) on their thinking."
Loos said 21% of agents cited "stock issues" as a factor driving their expectations, with 19% experiencing stock constraints, and only two percent experiencing too much stock.
