Johannesburg - The “affordability levels” of houses appear to have settled back to what they were around 2003 and 2004, according to a FNB survey.
First National Bank economist John Loos said on Thursday the sample of agents surveyed perceived housing affordability levels as having improved significantly since 2008, to levels comparable with those seen around 2004.
“Some may find it strange that we point to affordability measures back down at relative lows last seen around 2003/4, but yet those years were a time of extreme house price growth whereas the current period is definitely not,” he said of the latest FNB Estate Agent Survey.
The survey cautioned that the improving trend in affordability since 2008 had ended.
The lack of improvement was attributed to the SA Reserve Bank's slowdown in the pace in cutting interest rates.
Debt-service affordability improvements also appeared to have ended.
It was speculated that 2014 would see some deceleration in residential demand growth as well as a mildly slower house price growth. - Sapa