Updated: Mar 31, 2019
BUY TO LET PROPERTY SPECIALISTS
Hi my friends,
This is ABSA’s information. Let’s look at how property protects your asset value during times of financial crisis.
"Property Prices from 1966 to now - WHAT WILL A R1M HOUSE COST IN 2020?
Nominal House Prices House Price South Africa tracks house prices in South Africa since January 1966. House Price South Africa uses ABSA house prices, as defined at the bottom of this page. Predicted property prices to 2050, using a compound annual growth rate of 10% from 2013 (please note: this is to be used as an illustration only, house prices have grown at an average annual rate of 11.12% since 1966).
ABSA’s House Price South Africa reports:
House Price South Africa uses ABSA house prices for the middle segment. Prices are based on the total purchase price of all houses (including all improvements) for which loan applications were approved by ABSA Bank. Prices are smoothed for all houses between 80 m² and 400 m². Houses of which the prices exceed R3 500 000 in 2011 have been excluded from the calculations, as these fall into the luxury segment. Affordable houses less than 80m² are also excluded. House Price South Africa is independent and uses the house price trends in South Africa over the last 40 years, complemented by economic indicators and trends to forecast the outlook for the next 40 years. House Price South Africa is not associated with any estate agency or other vested interest. We welcome all contributions to the forum by interested investors. The house price information used on this site is ABSA’s house prices for South Africa. Population figures are sourced from UN published material. Inflation figures are sourced from Stats SA website. Interest rates are sourced from SARB website."
It is evident that while stock markets and annuities lost up to 40% during periodic financial crisis during 1984-1986 and again during 2008, property was the most stable form of income. The markets never made up lost value, while property retained value and caught up its losses within a few years. This pattern cannot be disputed.
So for those serious about investment, SA property is the way to go.