|Building data statistics for October released by StatsSA indicate that the building industry is still buoyant, according to a press release issued by Johannesburg economists Efficient Research.|
Building plans passed increased by 62 percent and completed buildings increased to 57,2% percent, which Efficient Reserch says indicates that expected demand for both residential and commercial property remains strong.
The average size of small residential buildings increased from 42,4m² to the current 43,8m² as the cost per square metre increased from R1 160,69/m2 to R1 558,56/m2. The larger residential buildings reported a decline in the average size although the cost per square metre increased. If all houses are analysed the average size declined to 129,5m² from 139,5m² while the cost has increased from R2 059,25/m² to R2 459,68/m².
The size and value of non residential buildings has declined from September with office and banking space recording the largest decline while industrial and warehouse has increased in both size and value.
The slowdown in the retail and banking space, according to Efficient Research, could be an indication that the rate of increase cannot be sustained despite the strong consumer demand. The slowdown in office and banking space could be a result of the indications from the SA Reserve Bank during this period that interest rates might be increased. The possibility of rate cuts should give a boost to the building sector, as the retail buildings should increase.