'House prices set to recover'

THE upward trend in nominal house price growth continued up to January this year, Absa said yesterday.

THE upward trend in nominal house price growth continued up to January this year, Absa said yesterday.

However, it said that in real terms, house prices continued to decline up to December last year, with the increase in consumer price inflation to a level of 6,3percent year-on-year influencing real price growth calculations.

"The up-tick in inflation can mainly be ascribed to base effects as a result of low fuel prices in December 2008," Jacques du Toit, senior property analyst, said.

Du Toit said the gradual recovery in the residential property market in South Africa was expected to gather further momentum in 2010 as a result of better economic conditions, the lagged effect of lower interest rates and less tight credit conditions. - Sapa

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