Gautrain boosts house prices
House price inflation around Gautrain stations has largely been following general property trends for the past two years, with the short-lived boom between 2005 and mid-2007 having tapered off since the general property slump of 2008.
On the whole, properties within 2km and 3km of Gautrain stations in Rosebank, Sandton and the Pretoria CBD are now mostly showing the same pattern of recovery as overall house price inflation in Johannesburg, Tshwane and Gauteng, with a few exceptions.
Lightstone recently completed a second study analysing residential repeat sales price inflation of residential properties within 2km and 3km of Gautrain stations in Rosebank, Sandton and Tshwane stations and comparing it with overall house price inflation in Gauteng. The first study looks at data from 2000 to 2007, while the latest research includes sales to date in 2010. The 2km and 3km distances were chosen to capture the effect of investors looking to benefit from ease of access to the stations, as these represent a relatively easy walk to the station.
House price inflation in Gauteng declined from around 7% in 2007 to 0.5% during 2008 and to a low of -0.3% in 2009. Price inflation around the Gautrain stations in Rosebank and Sandton has followed the same trend, to perform at roughly the same rate as overall inflation at between 7% and 12% in 2010. This is in contrast to 2007, when overall inflation for Gauteng was at 7% compared to 15% for Rosebank and 20% for Sandton. A trend that is evident in Johannesburg and Tshwane is that growth in property prices within 2km of stations remains somewhat volatile, while that of properties within the full range of 3km has shown more stable and robust growth and is now on an upward trend.