According to the latest Lightstone residential property index, October 2021 was the third consecutive month in which residential property prices increased by 5% or less.
The report showed that price increases across the provinces differ widely from one province to another.
The Free State, Eastern Cape, Gauteng and Limpopo all trended downwards. KwaZulu-Natal, North West and Western Cape are on the up, while Mpumalanga and Northern Cape remained unchanged from the previous month.
Price growth for lower-priced homes continue to outperform that of higher value segments.
Prices increased by 10.4% overall for this segment - almost double the growth of the mid-value segment, where prices rose by just 5.3%. Prices for high value and luxury homes increased by just over 4%.
House price activity
According to Pam Golding Properties’ report for the past year and outlook for 2022, the residential property market remained strong during the first half of 2021 - in terms of price growth and activity levels.
Quoting the Lightstone index, the report says that the total sales recorded during the first half of 2021 - about 128 000 units - is the highest sales number recorded during the first six months of the year over the past five years.
Despite the economy struggling to recover from a severe recession, this shows surprising resilience in the national housing market.
“Much of this demand has been driven by local buyers who have identified specific areas of interest and understand that the current market presents opportunities that offer exceptional value for money,” says Dr Andrew Golding, chief executive of the Pam Golding Property group.
Top performing metros
According to the Lightstone index, the top-performing metro market is Nelson Mandela Bay.
Johannesburg and Tshwane initially led the recovery in prices, but these appear to be approaching a peak. A similar scenario is played out in eThekwini, whereas Cape Town is now the only major metro market experiencing continued accelerated growth in house prices.
In Gauteng, Ekurhuleni shows the strongest performance, whereas price growth in Johannesburg and Tshwane appears to be peaking.
"Price growth in Ekurhuleni has been faster than in the other two sub-regions since mid-2020. It is perhaps benefiting from an influx of new buyers because this metro housing market offers more affordable homes and/or more space as the trend towards freehold homes or larger apartments for work from home takes hold,” says Golding.
“Among the major metro markets, Tshwane has registered the most sales so far for 2021. Out of the 44 857 sales registered in the six metro markets, 38.1% was recorded in Tshwane."
“Cape Town followed with the second largest number - 25.5% - and Johannesburg registered 22.8%. In Pretoria, well-priced homes that offer value continue to sell within six weeks, and it is encouraging to see that the buy-to-let market is picking up.”
Read more: Real estate agency predictions for 2022