Category Archives: Building Plans

A total of 235 building plans were approved in November and represents a 46.9% m/m increase from the 160 building plans approved in October. In value terms approvals increased by more than N$80 million to N$172 million in October from N$88.46 million approved in September. Total completions fell from the 88 recorded in October to 67 for November. In value terms however, completions increased by 67.1% m/m with N$86.85 million worth of completions registered in November. Year to date, N$2.09 billion worth of building plans have been approved, an increase of 12.2% y/y. On a twelve-month cumulative basis, 1,932 building plans have been approved worth approximately N$2.19 billion, 13.6% higher in value terms than the cumulative approvals registered in November 2016.

Additions to properties made up 197 approvals out of the total 235 approved plans recorded in November. Year-to-date, 1,484 additions to properties have been approved, increasing by 12.5% y/y and rising 14.7% y/y in value terms. With 2017 drawing to a close, year-to-date total approvals, in value terms, have surpassed the N$1.97 billion approvals registered in 2016 with N$119 million. By that account 2017 has, albeit marginally, been a better year than 2016 for commercial and residential real estate.

33 new residential units were approved in November, 12 more than the 21 approved in October. Year-to-date residential approvals showed further improvement with 277 new approvals, 36 units more than in the corresponding period in 2016. In value terms, N$407.9 million worth of new residential units have been approved year-to-date, a 22% contraction compared to November 2016.

Commercial and industrial building plans approved amount to 5 units, worth N$16 million for November. This is a month-on-month decline of 44.4% in the number of plans approved and a 31% decline in value terms as well.  Year-to-date 46 plans for commercial and industrial purposes have been approved, a far cry from the 76 building plans approved in the corresponding period in 2016. However, in value terms, 2017 is on course to exceed the N$482.3 million registered in 2016, with year-to-date value of commercial and industrial plans approved already at N$691.3 million. Reason for this being one large commercial plan approved in May this year that has buoyed the value of approvals considerably for 2017. This approval alone accounts for 72% of commercial and industrial building plans approved this year. Stripping out this single commercial property development would result in a contraction compared to 2016.

From a 12-month cumulative perspective, 1,932 building plans have been approved in November, increasing by 13% compared to corresponding period in 2016. Additions to properties exceeded new developments by more than four times. While private sector credit continuously slowed since the start of 2017, currently at 5.2% in October. Total mortgage loans extended to the private sector grew at an average of 8.2% during 2017. This is slower than the growth in mortgage loans of 11.7% recorded in 2016. Consumers and businesses will now look to 2018 in hopes of some relief, however recent downgrades and the potential of further downgrades in South Africa point to greater possibilities of a rate hiking cycle, which would put further pressure on consumers and will further delay a much needed economic recovery.

A total of 160 building plans were approved in October, 21 building plans less than what was approved in September. In value terms approvals decreased by 24.3% m/m, falling from N$116.88 million in September to N$88.46 million in October. A total of 88 completions to the value of N$51.96 million were registered in October. Completions increased by 33.1% m/m from 86 completions worth N$39.03 million in September. Year to date, N$1.91 billion worth of building plans have been approved, an increase of 13.2% y/y. On a twelve-month cumulative basis, 1,805 building plans have been approved worth approximately N$2.21 billion, 4.5% higher in value terms than the same measure for approvals in October 2016.

Additions to properties made up 130 approvals out of the total 160 approved plans recorded in October. Year-to-date, 1,287 additions to properties have been approved, increasing by 4.8% y/y and rising 7.5% y/y in value terms. Year-to-date total approvals are on track to exceed approvals registered during 2016 in value terms. As such, 2017 has been a better year than 2016 was, although not by much.

21 new residential units were approved in October, 6 less than the 27 approved in September. Year-to-date however, 244 residential units have been approved, 17 units more than in the corresponding period in 2016. In value terms, N$368.1 million worth of new residential units have been approved year-to-date, a 16.8% contraction compared to October 2016.

Commercial and industrial building plans approved amount to 41 units, worth N$675.3 million year-to-date. This is a decline of 43% in the number of plans approved from the 73 building plans approved in the corresponding period in 2016. This is however offset by the 54.2% increase in the value of these approvals compared to the corresponding period of 2016. One large commercial plan approved in May this year skews the value of approvals considerably. If one excludes this N$500 million plan, then the value of commercial and industrial plans approved year-to-date would be 60% below that of 2016 for the same period.

In the last 12 months 1,805 building plans have been approved, contracting by 0.8% compared to October 2016. Private sector credit extension growth slowed to 5.24% in September from 6.35% in August. Commercial banks are maintaining adequate monthly average liquidity positions and the slowdown credit extension growth is a sign of weak business and consumer confidence. Demand for debt has been low and the cost of debt risks becoming more expensive looking forward. Hopes of continued monetary policy support were dashed when the South African Reserve Bank (SARB) and Bank of Namibia (BoN) kept policy rates unchanged during September and October MPC meetings respectively. Mid-term budget reviews in both South Africa and Namibia that where characterised by expenditure overruns and widening budget deficits to be funded by ballooning government debt, have further exacerbated fears of credit ratings downgrades. This will place further pressure on consumers and business alike if it results in a rate hiking cycle. The outlook for a rebound in construction may thus be muted in the short term.

A total of 181 building plans were approved in September, 9 more than was approved in August. In value terms approvals printed flat at N$116.88 million in September, not far from the N$116.20 million in August. A total of 86 completions to the value of N$39.03 million were registered in September. This is an increase of N$19 million in compared to N$20.1 million worth of completions in August. Year to date, N$1.83 billion worth of building plans have been approved, increasing by 17.4% year on year. On a twelve-month cumulative basis, 1,814 building plans have been approved worth approximately N$2.24 billion, 1.4% higher in value terms than the same measure for approvals in September 2016.

Of the total 181 plans approved in September, additions to properties accounted for 149 of those approvals. This category usually makes up the majority of approvals and continues to do so. Year to date, 1,157 additions to properties have been approved to the tune of N$829.4 million, 8.5% higher than in the corresponding period in 2016.

27 new residential units were approved in September. Year to date, 223 residential units have been approved, 32 units more than in the corresponding period in 2016. In value terms, N$349.6 million worth of new residential units have been approved year-to-date, a 6.20% contraction compared to the N$372.7 million in September 2016. On a monthly basis, new residential unit approvals increased by 22.7%.

Commercial and industrial building plans approved year to date amount to 32 units, worth N$652 million. This is a significant contraction from the 65 building plans approved by September 2016. This is however offset by the 54.2% increase in the value of these approvals compared to the corresponding period of 2016. 5 commercial and industrial building plans valued at N$10.20 million were approved in September. On a 12 month-cumulative basis, commercial and industrial property approvals rose by 16.6% in value terms in September despite the number of approvals contracting by 50.5%. This points to larger projects being undertaken compared to the base period in 2016, an indication of improving business confidence.

In the last 12 months 1,814 building plans have been approved, contracting by 2.5% compared to September 2016. The latest private sector credit extension data showed slowing growth in credit extended to corporates and individuals in August. Mortgage loans extended to individuals contracted by 0.9% m/m in August, but rose by 4.6% m/m for corporates. Commercial banks currently carry a healthy monthly average liquidity position of N$3.5 billion, providing sufficient levels of loanable funds. Consumers therefore seem curtailed by waning appetite for credit, or are simply not meeting affordability requirements.

However, a more positive outlook lies within the current slowdown in inflation and Bank of Namibia (BoN) leaning towards further relaxation of monetary policy in support of economic growth. Having cut interest rates by 25 bps in August, we expect BoN to keep rates unchanged at the upcoming MPC meeting in two weeks’ time as the South African Reserve Bank (SARB) left rates unchanged at its September meeting, citing long term inflation outlook as a risk to policy decisions. However, further rate cuts are expected at the last two respective MPC meetings scheduled for this year. This in turn will provide consumers with relative but very welcome relief that will flow through to discretionary incomes.