In fact, house prices in Johannesburg's inner city are still surging ahead at a substantial 41%, according to latest figures released by mortgage risk management company Lightstone.
The Lightstone Inner City report, the first of its kind to track price inflation of inner city properties in South Africa's major metropolitan areas, shows that growth in the Johannesburg CBD has climbed steadily over the past five years, from 3% in 2002 to 41% in 2007.
Lightstone Business Development director Andrew Watt says places Johannesburg as South Africa's top performing inner city in terms of price growth. The inner cities of Cape Town, Port Elizabeth and East London have also shown a rising trend in house price growth over the past year. Cape Town is currently recording growth of around 10%, with Port Elizabeth/East London at 33%.
eThekwini has deflated quite rapidly over the past two years, down from a peak of 58% mid-2005 to the current 6%, which is the lowest in South Africa. Thswane has shown the most exaggerated peak, climbing to 65% in early 2006 but slowing down to 23% currently.
That brought the average growth for Lightstone's inner city index to 23% in mid-2007, compared to 15% recorded by its national house price index over the same period.
Interestingly, Johannesburg recently surpassed Cape Town for the first time in terms of sales value. In the 12 months to end-August, Johannesburg's inner city recorded sales of around R1,6bn compared to around R1,5bn for Cape Town's inner city.
Watt says in terms of number of sales, the CBD of Johannesburg is now second only to that of Pretoria - Johannesburg is expected to end 2007 with around 3,000 property sales compared to Pretoria's 3 600 sales.
When actual sales prices in inner cities are compared, Cape Town is still in the lead with a median price of R620k. That is more than double Johannesburg's median price of R305k. Median prices in eThekwini, Pretoria and Port Elizabeth/East London are currently at R275k, R310k and R340k respectively.
Watt says it's not surprising that Cape Town is still achieving the highest prices of all the inner cities given the high quality of accommodation on offer and relative lack of urban decay compared to South Africa's other CBD's.
Lightstone's inner city index tracks the price inflation of properties in major metro's back to 2000. The report covers some 52 000 sectional title properties in South Africa's Central Business Districts (CBD's) and Urban Development Zones (UDZ's), which make up a total value of R27bn. - Joan Muller
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