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Monday Apr 23, 2012

House sizes feel the effect of urban land shortages

Many people don't realise just how radically the residential property market has adjusted to the tougher economic conditions and the land shortages of the past four years, says Lanice Steward, managing director of Anne Porter Knight Frank.

"We have read a great deal about the 'more realistic' prices of homes today - coupled with ongoing admonitions to sellers to accept this situation. But the latest FNB Property Barometer reveals that new residential stands, which in 1970-1974 averaged just over 1 000m², dropped by 2010 to the present to just over 500m² - half the size - on new developments.

"Similarly, average building sizes have dropped from 203m² in 1970-1974 to 146m² in 2010 to the present, and this figure is still declining."

Also affected, said Steward, have been the sectional title units, where the average size of new units today is 90m².

"Sectional title units have always been relatively compact - the bigger units with 160m² or more mostly date from the 1950s to 1960 era. But the FNB figures show that by 2000-2004 on new projects the average had in fact crept up to close on 130m² - the drop to 90m² is therefore significant."

Another big change, says Steward, can be seen in the falloff in staff quarters and swimming pools. In 1955-59, more than half of new houses had staff quarters. Since 2010, this figure has dropped to 11.5 percent. In 1980-84, 40 percent of new houses had swimming pools, and today the figure is down to 9.1 percent. Garages, too, are now more frequently seen as luxury extras. Since 2010 only 51.6 percent of new homes have been given these compared to the previous figure of 69.5 percent.

She says there has also been a big decline in the number of four-bedroomed homes and a big rise in two-bedroomed homes.

"The good news for the property sector is that house prices are now beginning to stabilise in all the sought-after areas, and the banks are increasing the number of loans granted," she says.

"I still believe the property market operates on 10-year updown-up cycles, and I think we are now on the cusp of the market moving in a positive direction with more activity now clearly evident, although so far this has not necessarily affected prices."

Weekend Argus (Saturday Edition)


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