Number of approved buildings plans in Windhoek increased in April
A total of 164 building plans were approved by the City of Windhoek in April, recording an increase of 27.1% from the 129 plans approved in March, following two consecutive months of declines in approved plans.
The 12-month cumulative number of approvals has been ticking up since December 2017 and does provide for an optimistic view for approvals to return to above the 2,000-mark, last seen exactly 2 years ago.
This means that in monetary terms, approved plans increased by N$14.1 million to N$96.5 million, representing a 17.1% increase in April.
Meanwhile, the number of buildings completed in Windhoek for the month of April stood at 231, valued at N$55.5 million.
Additions to properties made up 127 out of the total 164 approved building plans recorded in April. This is a 19.8% increase in additions from the 106 additions recorded in March. This while, new residential units were the second largest contributor to the number of building plans approved with 36 approvals registered in April, an increase of 90% compared to the 19 residential units approved in March. Only 1 new commercial unit valued at N$8 million was approved in April.
According to IJG Research, the interest rate environment has changed since the turn of the year, however, monetary easing was widely expected to spur economic growth in 2018.
“This expectation dissipated with the market now not pricing in any more rate cuts in South Africa for 2018. What seems more likely at present is a possible rate hiking cycle, driven by recent rand weakness and an increasing oil price,” IJG stressed.
The research firm is of the view that these two inputs will weigh heavily on the South African Reserve Bank’s (SARB’s) inflation expectations with risks being toward the upside, changing the narrative towards higher interest rates should inflation rise outside of the SARB’s target band of 3%-6%.
“Bank of Namibia (BoN), which has kept its repo rate unchanged and simultaneously adding a 25 basis points buffer over the SA rate, is likely only to react if the SARB hikes rates beyond BoN’s current 6.75% repo rate,” IJG added.
This, IJG added, will effectively offer no reprieve to consumers whom have been the biggest users of credit.
Caption: The 12-month cumulative value of plans approved reached approximately N$2.2 billion, an increase of 27.9%. (photograph by IJG).