Is it correct to say that in spite of the current economic crisis globally, that our local housing prices have been stable? This is one of many questions asked by prospective buyers throughout our country these days. Tony Clarke, the Managing Director of Rawson Properties argues that the first half of this year will be a good time to buy residential property. One must consider or admit that SA has been able to curb around the full scale of the recession, and this is good news for the property industry.
If we go back to the beginning of the millennium, we will recall a huge house boom in SA. As early as 2006 though some statistics showed that the boom period was coming to an end. John Loos, a Property Strategist at FNB argues that the scarcity of building material has a great contribution in the country’s current house price performance as we are heading to the end of the decade.
“ We are witnessing a sharp rise in building costs. While demand for residential units is currently in a short term lull, a number of other sectors are placing huge demands on the construction sector at present”.
A good example to illustrate this that we are familiar with is the construction of stadiums for the 2010 world cup, and the amount of skilled labour that has been absorbed by these projects. The construction of these stadiums has also led to the scarceness of building materials e.g. sand, steel etc. John Loos goes on
“Furthermore, the government led infrastructure programmes besides the 2010 will be fast tracked for completion for 2010, either because they are required for the event or because of the positive impact they may have on the country’s image, creating a further construction industry supply crunch.”
The final issue that puts pressure on house prices is the scarcity of land, specifically around the metropolitan areas, says Loos.
We have therefore seen a decline in house building activities in 2008. This was due to difficult market conditions throughout the year and as the Reserve Bank governor Tito Mboweni said,“its bad out there.”
However, Jacques du Toit, a senior analyst at ABSA Home Loans predicts that inflation is set to decline further and therefore interest rates to be cut further in 2009. This will definitely bring relief to a lot of struggling consumers (Absa House Price Index – 5 March 2009). He further predicts that the housing market may continue in its declining trend for sometime in 2009 before improving in 2010. So there is light at the end of the tunnel after all, these tough times in the property market will not last for a very long time.
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Project News
Despite the slow down in the residential building market, has continued to flourish. Below are just two of the projects with which we are currently involved. The first, "42 Woodside" is nearing completion, whilst "House Taylor", is only just beginning.
42 Woodside:
“42 Woodside”, situated in Tamboerskloof near the Cape Town CBD is a double-storey residential building which was unfortunately badly damaged by a fire in 2007, and thus had to be refurbished. The client took the opportunity to make changes to the layout and finishes of the old house.
Aside from the damaged electrical points etc. where traditional fittings gave way to modern dimmers and down lights, the damaged roof structure was replaced by laminated timber and steel beams and new sliding folding doors open the house out to the rear garden. In the garden new screen walls were created and the existing swimming pool and the pool surrounds refurbished. Internally, en-suite bathrooms were created for the 3 bedrooms. Ceiling and floor finishes, although updated, were in keeping with the age of the traditional Cape vernacular house, whist the new sanitaryware and tiles etc. give the house a modernised touch.
was appointed as professional Quantity Surveyors for the project from commencement to completion and formed part of the project team, along with Berrisford Construction (main contractor) and Harrison-Hyde Architects (principal agent). Despite a tight programme and being a complicated project due to the fire damage, the works have recently been completed successfully.
42 Woodside Rd - after restoration & alterations
House Taylor:
This is an existing multi faceted double storey residential building in an up market location in Johannesburg. The house itself is situated in a rocky and uneven site, something that the Architects had to take to serious consideration in the re-designing of the building. LFS Architects has sought to transform the house thoughts its unique designs that alter the shape of the whole building. Aside from completely rearranging and extending the existing upper level bedrooms, it is the external façades that will undergo the biggest changes. A pond adds to the new features that enhance the entrance, whilst curved beams and walls, circular skylights and perforated screens contribute to this eloquent and unique design. have been appointed as Professional Quantity Surveyors for the project, and we are currently overseeing its tender adjudication process.
House Taylor - entrance court (before) House Taylor - garden perspective (before)
