HOW MUCH HOME CAN YOU GET FOR YOUR MONEY?

Analysing the affordability of SA’s residential property market

- RHYS DYER

SOUTH AFRICANS continue to tighten their belts as the pressure of rising interest rates, inflation, and other varying economic factors put household income under strain.

This puts the affordability of national residential property under the spotlight.

However, while (in nominal terms) national house price inflation remains positive (+1.9% in September 2022), the national average purchase price is down

The price among first-time homebuyers of properties purchased by this demographic registered a third consecutive decline in September 2022 (down 3.5%), reflecting first-time homebuyers' sensitivity to interest rate increases.

Interestingly, properties in Gauteng's South and East Rand continue to register robust growth in prices, despite this region's average house purchase price being the lowest at R1 183 032. The Western Cape, on the other hand, has the highest average purchase price in the country, but it is the only major region to report house price deflation.

After peaking in March 2022 at R2.05 million, the average purchase price of properties purchased in the Western Cape eased to R1.66 million in September-with purchase prices over the year to 30 September 2022 registering a decline of 2.1% compared to the same period last year.