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Johannesburg - House prices could begin to show year on year (y/y) growth within a month.
This would bring an end to 10 months of falling house prices.
This good news is reflected in Absa's latest house price index.
In September house prices in the middle segment of the market (80m² to 400m²) were a nominal 0.3% lower than in September last year and 0.8% higher than in August.
Jacques du Toit, senior property analyst at Absa's home loan division, says this is the fifth successive month of positive month-on-month growth.
The message now coming out of the housing market is that the cycle has turned and prices are on the road to recovery.
Prices of large houses (221m² to 400m²) have already turned and in September were up by a brisk 2.7% y/y.
Since the low of R1 362 900 reached in February this year, the average price of a large house appreciated by R53 500 to reach R1 416 400 in September.
Du Toit reckons one reason for this is that the upper income group has been less affected by the economic downturn.
Prices in the small- and medium-sized house categories, however, have continued to experience drops of 4.2% and 5.2% y/y respectively.
The recovery in the housing market will be slow. Du Toit expects a decline of less than 2% this year as a whole, and growth of 2% to 3% in 2010.
- Sake24.com
For more business news in Afrikaans, go to Sake24.com.