Year-on-year growth in the planning phase of residential of building activity in the South African market for new housing continued along seasonal trends in August 2014, as reflected by the number of building plans approved by local government authorities. The construction phase of residential building activity, i.e. the volume of housing units reported as completed, continued to contract in August on a year-on-year basis, but the pace of contraction was significantly lower and on a sharply improving trend since May this year.
Residential building activity is set to remain relatively subdued into 2015 around the levels of the past 4½ years. However, against the background of a growing population and an ever-increasing number of households, residential building activity will eventually have to rebound from current levels. Due to the all-important aspects of the affordability of housing and changing lifestyles in especially the major metropolitan areas in the country, the demand for and supply of new housing will most likely remain focused on the segments of smaller-sized houses (<80m²) and higher-density flats and townhouses, which comprised more than 73% of around 1,15 million new private sector-financed housing units built since 1994. Source: Building stats Aug 2014 (ABSA)