Townships trump suburban house growth | Fin24
 
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Townships trump suburban house growth

Jan 19 2015 13:27

Cape Town - House price growth in former black township areas outperformed major metro residential markets in 2014, First National Bank said on Monday.

The FNB House Price Index for areas formerly classified as black townships in six major metro regions rose by 9.5% last year, said FNB household and property sector strategist John Loos.

Comparatively, the growth rate for the overall major metro regions' house price index was 6.8%.

READ: Property prognosis positive for 2015 - FNB

The metros were classified as Ethekwini, Cape Town, Nelson Mandela Bay, Ekurhuleni, Johannesburg and Tshwane.

The higher growth in former townships related to affordability, with an average estimated house price of R304 562 last year.

Loos said there seemed to be a high percentage of first time house buyers last year.

According to the FNB Estate Agent Surveys, first time buyers stood at over 25% of sales.

Residential affordability also deteriorated last year.

"In short, affordability may be starting to become an increasing priority as the overall residential market strengthens, and this may play into the hands of former township markets, driving mildly superior house price inflation of late," said Loos.

ALSO READ: Food, oil key to SA property market - expert

fnb  |  john loos  |  property  |  sa economy
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