AA - 2020

Author:  Lightstone Residential Property Index
13 October 2020


Lightstone has released its ‘Lightstone Residential Property Index September 2020’.

Market Review

National house price inflation as at the end of August 2020 remained stable at 2.1%. Despite the general slowdown at provincial level.

The Eastern Cape, Kwazulu-Natal and the Mpumalanga province have been growing at increasing rates over the past year to an extent that they now lead the provincial growth with rates currently above 5% per annum.

Among the major municipalities, the coastal municipalities are generally performing better than those inland and this relationship extends to all coastal and inland properties as shown by their respective indices.

The low and mid value segments continue to buck the market trend by growing at more than 4% annually while the High and Luxury segments are inflating at rates below 2%.

Shining A Light On Our Approach…

Lightstone applies the repeat sales methodology when reviewing and reporting on property data.   In contrast to ‘average house price’ indices, repeat sales indices provide a measure of the actual price inflation of houses that have transacted twice within a particular period of time. The main benefit of this is that it is less influenced by the mix of transacting properties. The repeat sales methodology is recognised as the premier methodology for indexing house prices and is used by many international residential property price indexers including the Office of Federal Housing Enterprise Oversight (OFHEO) in the United States.

All property transactions in South Africa are registered in the Deeds Office and each record contains the legal details of both the property and the transaction. For the purposes of the Repeat Sales Index for residential properties, the following transactions have been excluded: farms; any transactions which may be of a development, commercial or community services nature; new developments; sales made in execution of a judgement; non-arms-length transactions; transactions where the inflation is extremely different to the norm of the statistical distribution of
inflation rates; and township transactions.

Lightstone presents both annual and monthly inflation rates. Monthly inflation emphasises recent market performance (i.e. month on month) and is more volatile than annual inflation trends. Conclusions about the future trend of annual inflation, based on monthly inflationary rates, must be made with caution.

The Lightstone Repeat Sales Index system applies advanced statistical methods to a comprehensive property database – compiled from the Deeds Office, the Surveyor General and other sources – to generate repeat sales inflation data for individual residential properties. Despite the statistical and actuarial rigour applied, Lightstone cannot guarantee the accuracy and reliability of the data. Furthermore, the index is a statistical tool and does not amount to advice and may not be applicable in some cases. Lightstone does not take responsibility for any losses incurred as a result of any person acting or omitting to act as a result of the publication of this index.

The original article can be viewed here:

  • National Inflation
  • Provincial Inflation
  • Latest/Current Provincial Inflation Status
  • Municipal Inflation
    Annual Inflation: Inland Municipalities
    Annual Inflation: Coastal Municipalities
  • Property Inflation:  Coast vs Non-Coast
    Annual Inflation:  Coast vs Non-Coast
    Coast:  Annual vs Monthly Inflation
    Non-Coast:  Annual vs Monthly Inflation
  • Property Inflation:  Free Hold vs Sectional Title Properties
    Annual Inflation:  Free Hold vs Sectional Title Properties
    Freehold Property:  Annual vs Monthly Inflation
    Sectional title:  Annual vs Monthly Inflation
  • Property Inflation:  Value Bands
    Annual Inflation:  Area Value Bands
    Annual vs Monthly Inflation:  Luxury Property
    Annual vs Monthly Inflation:  High Value Property
    Annual vs Monthly Inflation:  Mid Value Property
    Annual vs Monthly Inflation:  Low Value Property
  • Inflation Table
    The Annual Inflation Table provides a long term view of annual rates of inflation for various geographical areas and property types. Please note that historic inflation rates can change as transactions occur that imply price inflation for those periods.

Should you have any queries, please do not hesitate to email us:  info@lightstone.co.za or give us a call on 0860 106 389.