House prices surprise on the upside
The Standard Bank House Price Index for April rose by 6.9% over the past year. The main driver of property price increases was in freehold property, which rose by 9.1%, compared with the sectional-title price index, which increased by 7.6%. Mortgage advances, however, only rose by 4.5%, suggesting a general decline in purchasing activity in the property market.
According to the index, the average house price applied for with Standard Bank in April cost R1 028 790, up from an average of R991 860 in the first quarter of this year.
Although total income for an average buyer increased to R54 358 a month from R53 015 a month over the same period, it was not sufficient to combat rising house prices.
In April, the average purchase price was 1.58 times the average annual income, up from 1.56 in the first quarter of the year.
This reflects that, relative to income, the average purchase price grew faster during this period, thereby reducing affordability.