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Household financial and credit conditions
FNB - South Africa
The rise in the household debt-service risk index, at a time when household sector financial fundamentals are starting to turn for the better, could appear somewhat contradictory. However, this is not necessarily the case. The Risk Index does indeed take into account the fact that the debt-to-disposable income ratio is starting to decline. However, it also takes into account the fact that the ratio remains very high, as well as the probability that the scope for further interest rate cuts has diminished dramatically, if not run out. Household sector financial fundamentals are starting to point in the right direction, but still remain weak.

If and when these have strengthened a little further in 2010, it could well get to a situation where a more substantial decline in the debt-to disposable income ratio will start to offset the risk of a lack of scope for further rate cuts. For the time being, however, a high debt ratio still leaves the household sector highly exposed to any surprises, and hence the high Debt-Service Risk Rating assigned to it.
FNB - Household Credit Risk

South Africa's insatiable property appetite
RealEstateWeb - South Africa
Small, cheap is being snapped up. Rentals of more than R3 500 are "testy"

Small rental apartments for up to R2400 a month are being snapped up like hotcakes, but larger family units with two bedrooms or more at rentals from R3500 are testing affordability levels, says Soula Proxenos, Managing Partner of International Housing Solutions (IHS).

When one takes a bird's eye view of the affordable property market, a supply and demand mismatch is evident with levels of consumer interest hampered above the R3000 per month mark.
Overall the demand for housing in the affordable property sector is huge, but access to finance and associated costs are driving consumers to rent rather than buy.

Building sector not out of the woods
Property24.com - South Africa
Growth in building plans passed and completed improved in October, but the sector continues to show severe weakness.

Residential building statistics, in particular, continued to show weak performance in October.

In line with the continued decline in plans passed, residential plans completed declined by a weak -35% y/y, albeit showing some improvement from -39,4% y/y in September. Aside from household balance sheets remaining severely strained by over-indebtedness, declining employment figures, as well as high liquidation and insolvency numbers, have weighed down heavily on the housing market.

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