What's irritating about that article is that they use the house prices indices, not the prices in real terms or prices against average income.
What's worrying is that SA is by far the highest even in real terms.
Also keep in mind that SA is being compared against developed countries, with the exception of China. It would be useful to have the figures for other developing countries such as Brazil...
You can access and manipulate the graph here: http://www.economist.com/displaystory.cfm?story_id=14438245
"House prices in SA are still pretty low by international standards if you compare the cost of the average car with the cost of the average house."
Wrong assumption ... what happens if you compare the cost of the CARS against international standards? My latest check of a Base 1.8 VW Passat has it about 20% cheaper in the UK than South Africa + in SA I will probably pay at least an additional 7% interest on that if going the HP route! The ratio of house/car prices is only relevant if the car prices are at the same level to start with!
also 20% more expensive for a 1.6 Toyota Verso base spec as well in SA (current car) ... really ridiculous comparison house to car prices ... South Africans pay more for cars, pay more for interest on anything not paid for in cash ... really ridiculous measure ... it is all about disposable income and affordability - not multiples of car prices!
6 comments:
What's irritating about that article is that they use the house prices indices, not the prices in real terms or prices against average income.
What's worrying is that SA is by far the highest even in real terms.
Also keep in mind that SA is being compared against developed countries, with the exception of China. It would be useful to have the figures for other developing countries such as Brazil...
You can access and manipulate the graph here: http://www.economist.com/displaystory.cfm?story_id=14438245
there is no bubble
@ Anon
You can say what you want, but you cannot fight the fact that prices over the past year or two have come down in most cities and towns.
While I don't expect prices to implode like they did in the USA, I do think that price growth will stagnate over the next few years.
The 1-year period after the soccer WC will be interesting.
"House prices in SA are still pretty low by international standards if you compare the cost of the average car with the cost of the average house."
Wrong assumption ... what happens if you compare the cost of the CARS against international standards? My latest check of a Base 1.8 VW Passat has it about 20% cheaper in the UK than South Africa + in SA I will probably pay at least an additional 7% interest on that if going the HP route! The ratio of house/car prices is only relevant if the car prices are at the same level to start with!
... err ... and of course this leaves more money in the pocket of somebody in the UK for a more expensive house relative to their car ...
also 20% more expensive for a 1.6 Toyota Verso base spec as well in SA (current car) ... really ridiculous comparison house to car prices ... South Africans pay more for cars, pay more for interest on anything not paid for in cash ... really ridiculous measure ... it is all about disposable income and affordability - not multiples of car prices!
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