2 June 2021
The latest Absa Homeowner Sentiment Index (HSI) indicates that confidence in the South African property market has remained in line with the last quarter of Q4 2020, inching ahead 1% to end Q1 2021 at 81%.
Sentiment towards buying property has had its fourth consecutive quarter of sentiment improvement, ending Q1 2021 at 82%, the highest since the introduction of the HSI. Sentiment towards buying rather than renting also reached the highest level since the introduction of the HSI.
An emerging theme has been observed in the Q1 2021 survey – that of property renovations being leveraged to improve security. In this survey, 45% of respondents with a positive sentiment towards making renovations indicated that alterations are also an opportunity for improving security.
Sentiment towards buying property grew faster than sentiment towards selling property for the second consecutive quarter. The rally due to the low interest rate cycle on sentiment towards buying property has given way to property accumulating in value. This could be indicative of the anticipated price increases due to the widening gap between willing buyers and willing sellers.
The focus on affordability in the past few publications has been on interest rates, but what was also topical in this survey was affordability due to incidental property acquisition and ownership costs (transfer and maintenance costs). Non-property owners who prefer to rent, together with non-first time property owners have made reference to these incidental costs.
About the Absa HSI
The Absa Homeowner Sentiment Index (HSI) indicates the consumer confidence level regarding the property market in South Africa.
While understanding the overall confidence level of consumers gives us an important overall reference and hence remains important, we also measure various aspects of consumers' confidence levels. We refer to these as "sub-indices" in this report and among these we measure sentiments about the current timing for buying, selling and investing in property.
For any questions please do not hesitate to reach out to us at absahomeloans@absa.co.za.
