The latest figures to be released by John Loos, FNB’s residential property economist, show that 2009 was not nearly as bad a year for residential property as many believe, says Lanice Steward, MD of Anne Porter Knight Frank and, she adds, APKF’s year end figures confirm this.

“FNB have shown that the average house price in 2009 dropped year on year (i.e. in relation to 2008) by only 3,9%. They have also shown that the turning point has now been passed. In December average prices rose 2,7% - and this came on top of a 1,4% rise in November.”

These and other figures, said Steward, have to be seen in context: the FNB index reveals that house prices rose 194,5% from July 2000 to today. This equates to an annual rise in the region of 20%, “a truly remarkable performance by any standards”.

“What is even more remarkable,” said Steward, “is that Cape property is still bucking the trend and continues to be one of the best performers in South Africa.”

This, she said, was clearly demonstrated at APKF. The average price of their houses sold in 2008 was R2 242 000 and this increased in 2009 to R2 272 000. In a few areas price drops were not seen at all.

Rentals at the Cape, said Steward, have also held up remarkably well in 2009. At APKF the average rental rose from R6 500 in 2008 to R8 000 in 2009 – and although many other firms did not achieve quite such spectacular rises, the trend remains solidly upwards.

Steward said that a severe shortage of stock is now being experienced. This and other factors, especially the inability of developers so far to become involved because of the stringent lending criteria of banks, she predicts, will push average prices up by at least the 8% forecast by FNB.

“In view of what is now likely to take place this year it is essential that those planning to buy do so as soon as possible,” said Steward. “As the National Credit Act criteria are so tough this may call for a dropping of aspirations – but if buyers do not get in in the first half of this year they may regret it later.”