Guiding consumers since 2009

South Africans still conservative about renovations

By Staff Writer

The property market might slowly be returning to normal but, according to FNB's latest residential property outlook, South Africans are still hesitant when it comes to adding valuable upgrades to their existing homes.

According to the report by FNB, in the second quarter of 2010 only eight percent of homeowners were believed to upgrade or renovate their homes. Back in 2004, when FNB first started their residential property survey, 40% of homeowners were making renovations to their homes.

FNB property strategist John Loos believes that the this is because many households have had to curb their spending as the country's economy continues to recover from a recession.

"‘Restricted access to mortgage credit has no doubt also placed a dampener on value-add building activity," Loos told Poperty24.com.

"In addition, South Africans may be loath to invest extra cash in renovation projects given the current weak house price growth outlook."

"In the boom years it was easy to recoup money reinvested in residential property through rapidly rising house prices. But the significant slowdown in house price growth since late 2008 means it has become far more difficult to recoup renovation expenses.

"There may therefore be a view among many homeowners that other investment avenues may yield better returns."

Figures from Statistics SA confirm that money spent on renovations has taken a dive. Completed building plans for additions or alternations to already existing homes dropped by 26% from January to March 2010 year-on-year.

This is bad news for building contractors since they are already feeling the effects of the lack of contracts for new home building activity. Stats SA report that the value of new residential buildings completed from January to May 2010 dropped by 24.5% year-on-year.

Townhouses and flats have been hit the hardest, the number of new sectional title units completed between January and May 2010 is down by a staggering 54% year-on-year.

Recent Articles

Featured It’s possible to change your marriage regime

Many people wed before they sign an antenuptial contract (ANC). This is especially practiced by people in customary marriages and those not clued up about the ANC. The law says if there’s no ANC before the wedding takes place, the marriage will automatically be in Community of Property. 

Keep this in mind when taking out new financial products

Adding a product to your personal finance portfolio, such as insurance or an investment, is a big decision. We found out what you should keep in mind before taking out a new product, how you can assess the products you already have, and how you can generally improve your financial position.

Are you in debt denial?

With debt levels increasing at 13% more than income levels, South Africans are more debt-stressed now than arguably ever before. This is iterated by the National Credit Regulator’s (NCR) report that nearly half of credit-active consumers in South Africa have damaged credit records. However, only a few seek the necessary help.

Why should you invest in a mutual bank?

Often when people think about banking, they always think about commercial banks. Mutual banks hardly come to mind, but these banks offer investment opportunities that are often overlooked.

 

Deals

Aurora Spa 100-minute Treatment Special

Price: R449
When: Until 31 March
Where: Century City

Woodstock Grill and Tap Steak Thursdays

Price: R100
When: Thursdays
Where: Woodstock

KFC 5+5 Special

Price: R65
When: Until 25 February 2020
Where: Nationwide