A report by the South African real estate consulting firm, Rode & Associates, suggests that the property market, particularly houses, in South Africa will see a decline in prices for the seventh consecutive year by 2022, a trend that could prevail for years to come.

According to the report, the housing market had a steady start to 2022, with nominal prices (not taking inflation into account) in the first two months growing by 3.8% on an annual basis - slightly slower than the 4.2% growth recorded in 2021, writes News24.

But in real terms (taking inflation into account), housing prices have fallen by about 2% so far in 2022, as inflation has held steady at 5.7%.

The CEO still does not foresee a promising future in the South African real estate market, considering that its cycle ranges between 15 and 20 years.

""We are halfway through this trajectory of declining house prices in real terms and there is still a long way to go," said Erwin Rode.

Consumers are expected to face greater financial pressures, with rising interest rates impacting property purchases, as well as increasing debts that will not be paid on time (mortgage defaults) that may lead some homeowners to dispose of their homes for lack of other means.

The lending rate in March 2022 rose to 7.75% - above the pandemic lows that favored real estate investors.

"Mortgage rates will be higher in the coming years - because interest rates internationally are normalizing due to global inflation after being very low for some time."

In the fourth quarter of 2021 homes were, on average, only on the market for about eight weeks-the lowest since the pandemic began and well below the long-term average of 13 weeks.

"When homes are on the market for a shorter period, it means that sellers have become more realistic in their expectations," Rode said.

First-time homebuyers accounted for 31% in Q4 2021, but the report expects higher interest rates, along with higher inflation, are starting to have a dampening impact on demand from these buyers.