Building slump 'not likely to last long'
The value of recorded building plans for February fell by a whopping 44,2percent compared with the same period last year - a far cry from the 17,1percent year-on-year growth recorded in the building boom of 2007.
According to Statistics SA, residential building plans fell sharply by 56,3percent. This was followed by declines of 31,4percent and 20,2percent for additions, alterations and non-residential buildings respectively.
Eight provinces reported decreases in the value of building plans passed from January to February.
Gauteng had the steepest negative growth of 15,3percent amounting to R2,1million, followed by the Western Cape with a 10,7percent decline and KwaZulu-Natal at 10,6percent, amounting to R1,4million.
The total industry value in February was R3,1billion from R2,5billion in January and R5,6billion at the same time a year ago.
Chris Hart, economist at Investment Solutions said it was unlikely that the downturn in the building sector would last long, and regarded the current period the lowest we can expect.
"At the moment we will be seeing the worst, and then things will get better especially as interest rates continue to drop."
Hart said a decline in the recorded building plans should not be undermined as it was a "leading indicator" for future activity.
"However I am optimistic that building plans will pick up in the second part of 2009," he said.