According to the latest Absa House Price Index for November, South African property prices have surged during the last year by an average rate of 35.1%. Yet Property prices in South Africa are set to continue rising.

Absa, South Africas largest home loan lenders, anticipates a small slowdown in the rate of growth in house prices next year with growth of about 20% projected for 2005, according to senior economist, Jacques du Toit.

With supply failing to satisfy demand, property economist Erwin Rode, of Rode & Associates believes that the house price boom will continue in the foreseeable future. "One can expect this to continue for a long time because the growth rate has a momentum that is not easily reversed unless something catastrophic happens", he said.