Real home prices fell in March

The FNB house price index for March showed further slowing in its year-on-year (y/y) inflation rate‚ from a revised 2.9 percent in February to 2.2 percent in March. This continues a mild slowing growth trend from a “mini-peak” of 7.7 percent growth reached in July last year.

The average value of homes transacted in the FNB house price index was R850‚036 in March.

“While year-on-year growth was still slowing in the first quarter of 2013‚ suffering from high base effects of a year ago‚ quarter-on-quarter house price growth just started to show early signs of improvement in the first quarter‚” said John Loos‚ household and property sector strategist at the bank.

“A relatively solid period of house price growth in the first half of last year created a high base off which current year-on-year growth comes‚ and it is this high and rising base effect which is a key contributor to low and slowing year-on-year growth in the early stages of 2013‚” FNB said.

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