Residential building activity improved in the first quarter of 2011

On Friday, Stats SA released the building statistics for March 2011. Overall, building plans passed improved by 5.0% during the first quarter of 2011 compared with the first quarter of 2010. The biggest percentage increase was reported for non-residential buildings, up 9.4%, followed by residential buildings 6.8%. Additions and alterations improved marginally by 0.1%.

Building activity improvement in the residential sector is most likely attributable to a growing demand for affordable housing, supported by low interest rates, an improvement in consumer income, easing of bank credit conditions and the long-term structural shortage of residential property. The first-quarter of 2011 trends with regard to residential building activity are encouraging and if the current supply and demand conditions continue, we should see further improvement for the rest of the year.

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