Ricochet News

Port Elizabeth properties the cheapest in SA - 24% cheaper than in East London

JULY 10, 2015
Port Elizabeth properties the cheapest in SA - 24% cheaper than in East London

Port Elizabeth is the cheapest area to live in among South Africa’s eight metropolitan municipality areas, according to a new report by HomeBid. East London, with an average home price transferred at R821 039, is actually 24% more expensive to live in than Port Elizabeth at R661 552.

These are the results from HomeBid’s analysis of some 136 000 homes transferred in the various deeds offices during the first half of 2015. 

The same research also found that, contrary to popular belief, the average home price in Johannesburg in higher (at R1 566 017) than in Cape Town’s (R1 492 551) while Durban follows slightly behind Cape Town at R1 448 251.

Owing to increasing public sector employment levels, Pretoria and Bloemfontein properties were R1 042 899 and R981 205 respectively while the average home East Rand is 34.4% cheaper than in Johannesburg.

Property sales on the decline

However, property sales and transfer activity levels are expected to drop further during the second half of 2015, according to Neville Berkowitz, property economist and adviser to HomeBid.

This is in part due to the waning economy, consumer confidence levels have hit 15-year lows and interest rate increases are predicted to rise by between 0.25% and 0.5% per year before the end of the year.

Monthly home sales transferred in the various deeds offices throughout South Africa are averaging 22 640 for the first six months of 2015 compared to the monthly average of 24 140 homes transferred during 2014, a drop of 6.2% according to HomeBid.

Durban saw the biggest drop in activity levels, namely down 10.7%, followed by East London (down 9.7%), Cape Town (down 9.5%), the East Rand (down 9.0%) and Port Elizabeth (down 7.9%). Johannesburg (down 6.1%) proved to be the average drop of the top nine sales areas with Bloemfontein at a small drop of 1.6%.

Only the Vaal Triangle at an increase of 0.8% and Pretoria at an increase of 0.2% saw slightly more sales and transfer activity in 2015 than in 2014.

"I have been in the property market since 1973 and I have seen numerous upswings and downswings and make no mistake, we are in a downswing. The public needs the transparent facts so they can make correct decisions about buying, selling or staying in their current home, which invariably is their most valuable asset,” said Berkowitz.

---article based on one published by Fin24.