Contrary to popular belief Johannesburg’s average home prices (R1,566,017) are higher than Cape Town’s (R1 492 551) and Durban’s are only slightly behind Cape Town’s (R1,448,251), according to HomeBid’s analysis of some 136,000 homes transferred in the various deeds offices during the first half of 2015.
Pretoria and Bloemfontein, buoyed by increasing public sector employment levels, are averaging R1,042,899 and R981,205 respectively.
The average home price on the East Rand is 34.4% cheaper than in Johannesburg.
East London with an average home price transferred at R821,039 is 24% more expensive to live in than Port Elizabeth at R661,552.
The Vaal Triangle is the cheapest area to live in among the top nine metro areas monitored by HomeBid, with an average price of homes there at R656,623.
Average home prices in South Africa
Property sales and transfer activity levels are expected to drop further during the second half of 2015, according to Neville Berkowitz, property economist and adviser to HomeBid.
This would be as economic conditions are deteriorating, consumer confidence levels have hit 15-year lows and interest rate increases are predicted to rise by between 0.25% and 0.5% per year before the end of the year.
Monthly home sales transferred in the various deeds offices throughout South Africa are averaging 22,640 for the first six months of 2015 compared to the monthly average of 24,140 homes transferred during 2014, a drop of 6.2% according to HomeBid.
Durban saw the biggest drop in activity levels, namely down 10.7%, followed by East London (down 9.7%), Cape Town (down 9.5%), the East Rand (down 9.0%) and Port Elizabeth (down 7.9%). Johannesburg (down 6.1%) proved to be the average drop of the top nine sales areas with Bloemfontein at a small drop of 1.6%.
Only the Vaal Triangle at an increase of 0.8% and Pretoria at an increase of 0.2% saw slightly more sales and transfer activity in 2015 than in 2014.
“I have been in the property market since 1973 and I have seen numerous upswings and downswings and make no mistake, we are in a downswing. The public needs the transparent facts so they can make correct decisions about buying, selling or staying in their current home, which invariably is their most valuable asset,” said Berkowitz.