FNB Property Barometer
HIGHLIGHTS
* FNB April House Price Index up 5% year-on-year, a slower growth rate than the March 5.2%, continuing a broad slowing inflation trend. Month-on-month house price inflation remained near to zero in April
* Real house price levels still 67% above early-2001 levels but -18.3% down on the December 2007 Boom time high
* FNB Valuers Market Strength Index still points towards a well balanced residential market, but shows a recent lack of further strengthening
* Economic data releases in April were “mixed”, but still point towards economic mediocrity, with the SARB Leading Business Cycle Indicator recording its 16th successive year-on-year decline in February
* The disinflationary impact of low oil prices has started to abate, with CPI inflation beginning to rise in March. Further expected rise, back up to near the 6% SARB upper target limit by late-2015, is expected to see the resumption of interest rate hiking late this year.
* The FNB Euro and Pound-denominated House Price Indices continued to rise year-on-year in April, but dollar strength continues to see SA property cheaper for those foreign buyers dealing in the Greenback.
* Ongoing economic weakness, along with an expected move towards a resumption of interest rate hiking, is expected to move house price inflation down to still lower single digit territory in the near term.
05 Aug 2015
Author John Loos
