The diverging trends in building activity with regard to new private sector-financed housing in South Africa continued up to mid-2018. The planning phase (building plans approved by local government institutions) improved on a year-on-year basis in the first half of the year, whereas the level of activity in the construction phase (housing units reported as completed) showed a substantial contraction compared with the first six months of last year.
Building plans approved for new housing increased by 9,3% year-on-year, or a total of 2 539 plans, to 29 866 plans in January to June this year, whereas housing units reported as being completed contracted by 22,7% year-on-year, or by a total of 4 597 units, to 15 612 units in the first six months of the year.
The average building cost of new housing completed increased by 5,5% y/y to R7 362 per square meter in the first half of 2018, compared with R6 979 per square meter in the corresponding period last year.
Building activity with regard to alterations and additions to existing houses remained under downward pressure, with both the building area approved and the building area reported as completed contracting on a year-on-year basis in January to June.
Residential building activity is over the short to medium term expected to stay much in line with trends of the past few years.
Read more here: Absa Building Stats June 2018