FNB Home Loans House Price Index April 2010
The FNB House Price Index is a monthly report that looks at the rate of change in residential property prices as well as the current average house price. The data used to produce this report is sourced from properties that have an FNB bond registered over them.
According to FNB Home Loans, House Prices are currently growing at 10.1% on average. This is the first time in two years that year-on-year growth reached double figures. The average house price is now estimated to be around R790 000.
The rate at which property prices are increasing has increased rapidly over the last 4 months.
Year-On-Year growth for the first quarter of 2010:
Jan = 3.5%
Feb = 6%
Mar = 8.1%
Apr = 10.1%
Why Property Is The Cornerstone Of Building Wealth
To illustrate this, if you owned a R1million property in March 2009 that property would be worth R1,081,000 in March 2010. But a property worth R1mil in April 2009 would be worth just over R1,100,000 in April 2010.
And according to the FNB House Price index, properties valued at about R1mil in April 2010 would have costed you only R335 000 in July 2000. That is close to 200% growth over almost ten years!
If your R1mil property continues to grow that that rate it would be worth almost R3mil in 2020.
Don’t Expect Fireworks Just Yet Though
Despite the fairly rapid recovery in house price growth John Loos, Property Analyst at FNB Home Loans, believes that we are about to reach the peak, and the rate at which property prices continue to increase will start to taper off during the second half of 2010.
The fact that interest rates are excepted to remain unchanged for the rest of 2010 further supports the idea that the property market will only experience a slow but steady recovery.
Download the Full April 2010 FNB House Price Index
- Year-on-year growth is the growth in prices measured over 12 months.
- Nominal growth is the growth in prices excluding the effects of inflation.
- Real growth is the growth in prices taking into including the effects of inflation.
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