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Johannesburg - The average house is now worth more than R1m.
Nominal house prices in November have surprised with brisk growth of 4.7%, year on year.
This growth brought the average house price in the middle segment of the market (80 square meter tot 400 square meter) to R1 006 332, as reflected in Absa's latest house price index.
The revised year-on-year growth for October was 3.4%.
This is a definite indication that the housing market has turned and improved faster than property analysts initially predicted.
As far as price growth is concerned, the market is now on more or less the same level as it was 18 months ago when house prices moved up by 4.2%, says Jacques du Toit, senior property analyst at Absa's home loan division. In November five years ago the average house price was
R634 727 and, in November 1999, R240 043.
The figures indicate the capital growth homeowners with long-term investment horizons have seen over the past decade. It is unlikely, he says, that homeowners with a long-term view of five years or more will get less for their property than they originally paid for it, despite the decline in the residential cycle over the past 10 years.
Despite the recent improvement in prices, he does not soon expect the sky-high double-digit growth seen earlier. If the recent rising trend proves sustainable, one can expect a nominal 5% price appreciation over the whole of next year.
- Sake24.com
For more business news in Afrikaans, go to Sake24.com.