Johannesburg - The areas formerly classified as "black areas" under apartheid have outperformed the former white "suburbs" in terms of house price growth, according to a First National Bank (FNB) index.
The FNB former black township house price index for major metro regions rose by 8.4% year-on-year (y/y) in the first quarter of 2013, FNB household and consumer strategist John Loos said in a statement on Tuesday.
"This was mildly higher than the 6.3% recorded for the entire market in the six major metros - Ethekwini, Cape Town, Nelson Mandela Bay, Ekurhuleni, Joburg, and Tshwane," he said.
"This growth also represents an improvement on the first quarter's 5.7% for township regions."
Around the 2008/9 recession and interest peak, the index saw a significant deflation, reaching a -15.1% y/y decline in the second quarter of 2009, compared to the metros' -4.5% decline.
"But when the market has periods of strengthening, such as in 2009/2010... one also saw the township house price growth rate rebounding more impressively than the overall market off a low base," Loos said.
"Therefore, we should perhaps expect the township house price growth rate to mildly outperform the rest in the near term, with the residential market going through a relatively good patch, with interest rates low and access to credit for entry-level buyers good."