HOUSE prices in Namibia have shot up by 20% since the beginning of the year, Namene Kalili, research and competitor intelligence manager at FNB Namibia, has said.
The FNB House Price Index for August registered its highest growth in five years, ending the month at 176 basis points.
Â“Price movements in the central and coastal markets were largely responsible for the accelerating house prices as an increased supply of new properties in the middle to upper price segment pushed up overall prices,” Kalili said on Wednesday.
The value index rose by 7,6 basis points through August, but because it came off a relatively low base, it was unable to minimise house price inflation, he said.
Central property prices continued to rise as house prices increased by a further 6,5% month-on-month. This has accelerated the year-on-year growth of central house prices to 39% in August.
“This is the longest and steepest price escalation in the central market since the beginning of this index. Consumers have noticed the escalating house prices and are jumping into the housing market to cash in on these paper fortunes and it is this flood of new money that is driving house prices to elevated levels,” Kalili said.
The year-to-date data shows that house prices are increasing in Windhoek, which was virtually flat all year long and is suddenly up by 15% year to date. Okahandja lost some growth momentum during August, and although prices have risen by 28% year-to-date, prices did grow at a slower pace than previous months.
Coastal house prices peaked in July and have begun their seasonal decline in August as they fell 2% month-on-month.
Month-on-month, northern house prices were flat in August, but were up 6,5% year-on-year.
House prices were flat on the back of strong volume growth as more developments materialised in the northern market. Eenhana was at the forefront of the volume growth as affordable land filtered into the index in the form of completed middle to upper housing units. Katima Mulilo was another notable contributor.
Kalili said house prices in the southern property market remain as erratic as ever due to the very small sample size.
“However, house prices rose 23% month-on-month and are up 55% year-on-year.
LÃderitz and Mariental continued to post strong growth, but with that said, Mariental property prices have begun to lose some growth momentum of late.Â”