FNB Building Cost Indices
FNB.co.za - South Africa
While the FNB Residential Building Cost Index's year-on-year inflation rate of 1.4% is moderate, important is that it appears to still be well-above existing house price deflation, which according to the FNB House Price measure runs at -10.2% in April. In the context of existing house price deflation and very weak demand, even this low house price inflation becomes very significant in exerting pressure on the building industry's performance.
Given the expectation that national house price deflation may remain in place for most of 2009, the differential between input cost inflation and house price deflation may only start to narrow towards 2010, making it extremely tough for contractors to deliver new stock to the residential market. The negative aspect to this is obviously from a developer/contractor point of view. However, the positive side to it the maintaining of a higher replacement cost of housing (i.e. the cost of acquiring new houses) relative to the price of existing property is crucial in keeping the market in some sort of balance, of at least slowing supply until demand can catch up to restore the balance.
The result of the expected continuation of some sort of differential between input cost inflation and house price deflation in 2009 is expected to be further decline in the volume of residential buildings completed, as contractors battle to reduce input costs in order to keep up with expected ongoing house price deflation for most of the year.
How SA's property prices rank
RealEstateWeb- South Africa
It is not pretty and is expected to get uglier - report.
The global housing market is likely to remain under intense pressure for the remainder of 2009, according to the Knight Frank Global House Price Index Q1 2009 report, released on Tuesday.
Lack of credit, uncertainty about the shorter-term future, especially the financial security and in some markets, oversupply and the cumulative effects of many years of strong house price growth has been blamed for the pressure seen in the global housing market. However, despite the sombre news there were still markets where house prices rose.
Israel was the top performer over the 12 month period (see table) with a house price record growth of 10.9%, followed by the Czech Republic at 9.9%. South Africa's year-on-year house price growth in Q1 was -0.3%, ranking it among the worst performers at number 16, an improvement from number 18 in the same quarter last year.
Forfeited farm dispute resolved
Business Day - South Africa
THE Supreme Court of Appeal seems to have found a solution to the problem of immovable property that has to be forfeited to the state but belongs to a couple married in community of property.
The court modified the KwaZulu-Natal High Court, Durban, forfeiture order of a farm owned by Samuel Mazibuko and his wife Anna Mazibuko. The appeal court ruled that upon the sale of the farm, the curator should pay Anna Mazibuko half of the net proceeds of the property.