Year-on-year growth in the nominal value of middle-segment homes in the South African residential property market slowed down further in November 2014 against the background of a continuing declining trend in month-on-month price growth since early this year. In real terms, i.e. after adjustment for the effect of consumer price inflation, year-on-year house price growth was in positive territory, but remained relatively low in the ten months up to October on the back of inflation averaging 6,2% year-on-year (y/y) over this period.
In view of trends in and prospects for the economy and the household sector, as well as house price growth in the first eleven months of the year, nominal price growth of around 9% is forecast for the full year. The expectation is for house prices to rise by a nominal 7,5% in 2015, with real price growth to come in at about 2%, based on current inflation projections for next year.
