Private sector-financed building activity in the South African market for new housing showed divergent trends in early 2019.
The number of building plans approved for new housing was down by 19,8% year-on-year, or 2 160 plans, to 8 739 plans in the first two months of the year, whereas the volume of new housing units reported as being completed that increased by 6,2% year-on-year, or 358 units, to a total of 6 101 units over the same period.
The average building cost of new housing completed increased by 4,9% year-on-year to R7 793 per square meter in the first two months of 2019 from R7 432 per square meter in the corresponding months of 2018.
Building activity with regard to alterations and additions to existing houses remained under pressure in the first two months of the year, with the building area approved rising by a marginal 0,5% year-on-year, whereas the building area reported as being completed contracting by 19,7% year-on-year. The building cost of completed alterations and additions to existing houses increased by 8,4% year-on-year to R7 543 per square meter in January and February this year from R6 959 per square meter in the same months last year.
Against the background of general economic conditions and prospects, residential building activity is expected to remain under pressure over the short to medium term.