The number of square metres approved in January 2023 plummeted by 41 percent on a year on year basis, pulled down by a decline in the retail, industrial and housing market. This was the steepest decline since the 3rd quarter of 2020 during lockdown, and prior to that in 2009 when the value of approvals slumped by 51 percent y-y in July 2009. A myriad of factors is impacting on the local building industry, including the delayed impact of higher lending rates, dismal economic performance, weak domestic and foreign investor sentiment, higher incidences of load shedding, deteriorating state of provincial and municipal infrastructure, to name just a few. The outlook for the investment in buildings is still for a moderate 2 percent to 3 percent growth in 2023 as previously approved projects reaches various construction phases, but a slowdown in the pipeline, will start to impact the industry more severely in the next 18 to 24 months.
The outlook for the residential market has now turned negative, with a 5.4 percent y-y decline in approvals over the last 12 months, while the non-residential market increased by a moderate 2.6 percent from a record low base.
| File |
|---|
| Building Plans Approved National Summary January 2023 | |
