Nominal year-on-year growth in home values in South Africa, based on Absa’s house price data, remained relatively low in the 1st quarter of 2016, after a sustained declining trend throughout 2015.
Some real price deflation occurred in most segments as a result of rising consumer price inflation in the early stages of the year. These trends in house price growth came on the back of a range of macroeconomic developments and factors affecting consumers financially, and eventually the various segments of housing.
Against the background of economic and household sector trends and expectations, nominal house price growth is forecast to slow down from above 6% in 2015 to below 5% this year and next year, with the risk for price growth to the downside. Based on the forecasts for nominal house price growth and the headline consumer price inflation rate, some real price deflation is projected for 2016 and 2017.
Read more here: Absa Housing Review 2016 Q2