 South
Africans have traditionally been spoilt for property space, but that’s
been changing in recent times and, in keeping with trends elsewhere in
the world, the process is set to continue with properties becoming smaller.
The implications for developers, estate agents, homebuyers and all
other stakeholders in the property sector are far-reaching says RealNet
property group CEO Tjaart van der Walt.
He refers to statistics from Absa showing that historically the average
stand size in South Africa was 1275m², but by 1991 had dropped
to 932m² and by the fourth quarter of 2006 (the latest available
statistics) had decreased to an average of 520m².
As to actual house size, the most recent numbers from Statistics South
Africa show that from January to August 2007, the average house size
for which new plans were passed was 135m² – only a little
larger than the average flat or townhouse size of 129m² and well
within Absa’s ‘small house’ category of 80m² to
140m².
“In other words our properties are getting smaller under the pressures
of building costs, affordability, the broadening base of home buyers
and the need for more efficient use of services,” says Van der
Walt.
“We are not alone in this of course. Anyone who has visited the
UK or Europe will know how small their homes are generally and now even
in the United States, the land of the big and brash, home builders are
putting up fewer supersize homes as significant numbers of buyers start
to demand smaller units.”
Boston real-estate research firm Hanley Wood Market Intelligence predicts
that floor areas are going to get even smaller in tune with the market
realities of higher prices and tougher financing with buyers finding
it difficult to qualify for home loans in the wake of the sub-prime
mortgage scare.
Home sales in the US have dropped some 19 percent over the past year
leaving builders saddled with unsold stock, particularly of larger homes.
According to the American Institute of Architects this is causing them
to redraw their blueprints indicating that the next step after reducing
prices on current inventories of unsold homes is to start building to
a new market.
And, says Van der Walt, exactly the same trend is evident in South
Africa, “notwithstanding the fact that we have had better credit
controls on home lending”.
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Newsletter:
12 March to 19 March 2010 - Vaal Triangle, South Africa
