Johannesburg’s Soweto region (Diepkloof-Soweto-Meadowlands-Pimville) has been the city’s star performer, with a five-year cumulative house price growth rate of 37.35%. Sandton, however, has only inflated 22.66% since early 2012.
This is according to FNB’s household market strategist, John Loos, who said the “former township” regions can have certain distortions in their price inflation rates, caused by some disposal of municipal rental stock onto the market in earlier years at below market value, or subsidised homes having earlier being registered at values not market related.
“We would still believe this superior Soweto region house price performance over the past five years to be reflective of what has been taking place in that region,” he said, noting the node’s major infrastructure and retail upgrades over the years, making it more attractive for new housing market entrants searching for affordability. “In Q1 2017 year-on-year house price growth rates for the Diekloof-Soweto-Meadowlands-Pimville region is slightly negative at -0.41%.”
Gauteng home to first-timers
House prices in Gauteng’s three major metros in Q1 2017 saw the City of Tshwane at 4.21%, Ekurhuleni at 3.92% and Joburg at 3.41% year-on-year.
Gauteng’s house price performance is indicative of the national economic picture, and is far “friendlier” market to first-time buyers, as the two summer 2016/17 quarters show: Estimated first-time buying in Cape Town is 8% of total home buying; Joburg and Tshwane is estimated at 27% and 21% of total home buyers, respectively.