“According to these figures,” says Berry Everitt, MD of the Chas Everitt International property group, “SA now has a population of just over 50m, about a third of which is under 15, and 7% of which is over 60.
 
“This means that there are around 30m people aged between 16 and 60 - and that if even only 5% of them were to buy or rent a new home in the next 10 years, we would need 1,5m new housing units - or some 150 000 units a year!”
 
This explains, he says, why some developers are getting excited about the housing market again now, especially given that the banks have several special initiatives running to make it easier for first-time and lower income buyers to obtain home loans.
 
Writing in the Property Signposts newsletter, Everitt notes that during the first five months of this year, the number of building plans passed by the major municipalities increased by 7% compared to the same period of 2010, but that further analysis shows that there was a whopping 21% increase in the number of plans passed specifically for flats and townhouses – the types of units most favoured by new buyers and tenants.
 
“These plans should translate into completed units in about 18 to 24 months’ time, but the actual number involved is only around 5000, while the plans passed in the same period for new small houses only totalled around 8500 – not nearly enough to meet the anticipated demand as the economy improves and job creation increases.”
 
Meanwhile, he says, buy-to-let purchasing is starting to increase again as a few forward looking investors anticipate the rising demand for rental units, and take advantage of the current low pricing and low interest rates to acquire stock.
 
“But according to FNB, the percentage of all purchases now being made by buy-to-let investors is still only 8%, which is a long way off the 25% of the boom years – and means that many investors are going to miss this boat unless they wake up soon.”