The number of building plans approved for new housing was down by 14,8% year-on-year (y/y), or 2 900 plans, to 16 666 plans in the period January to April this year. The contraction in plans approved was driven by the two segments for houses, with the segment for flats and townhouses showing growth of 14,5% y/y over the 4-month period.
The volume of new housing units reported as being completed increased by 36,7% y/y, or a total of 4 037 units, to 15 052 units in the first four months of the year. All three segments of housing contributed to the above-mentioned growth over the four months up to April, with especially the segment of flats and townhouses showing particularly strong growth of 66,1% y/y with in respect of new housing built.
The average building cost of new housing completed increased by 5% y/y to R7 802 per square meter in the first four months of 2019 from R7 434 per square meter in the corresponding period last year. In real terms, i.e. after adjustments for inflation, residential building costs increased by 0,8% y/y, based on an average headline consumer price inflation rate of 4,2% y/y over the 4-month period. The average building cost per square meter in the three categories of new housing was as follows in the period January to April this year:
- Houses of <80m²: R5 630, up by 2,4% y/y. Houses of ≥80m²: R7 568, up by 2,1% y/y.
- Flats and townhouses: R8 374, up by 6,4% y/y.
Building activity with regard to alterations and additions to existing houses continued to contract in the first four months of the year, with the building area approved declining by 2,4% y/y and the building area reported as being completed contracting by 12,1% y/y. The building cost of completed alterations and additions to existing houses increased by 4,4% y/y to R7 525 per square meter in January to April from R7 210 per square meter in the same period last year. In real terms, the average building cost of completed alterations and additions to existing houses was only marginally higher by 0,2% y/y over the 4-month period.
Trends in and the outlook for the economy, household finances and consumer and building confidence will remain important drivers of residential building activity in the rest of the year.