28 Mar 2017 12:20pm
WINDHOEK, 28 MAR (NAMPA) The cost of building materials increased by 6.3 per cent in February 2017, according to the First Capital Housing Building Cost Index.
The February 2017 report released on Monday said the price of building materials do not differ widely between local towns, with Swakopmund and Ondangwa offering the cheapest building materials.
The combined weight of cement and bricks on the total bill of quantities for a standard three-bedroom house is now one per cent down to 30 per cent from the 31 per cent recorded a year ago, indicating that the price of cement and bricks was more stable than other building materials, said the report.
It also said serviced land remains cheaper in Keetmanshoop than in Windhoek, where serviced land is seven times higher than in the southern town.
Building a house constitutes three forms of input. Using February 2017 prices, building materials contribute 67 per cent of the costs, labour 27 per cent and land six per cent, the report said.
In a normal situation where the project time is met with no defects during construction, a budget of N.dollars 336 475 could be sufficient to construct a standard three-bedroom house in Keetmanshoop, while in Windhoek because of high land prices it will be higher, but not more than N.dollars 420 000.
The report indicated that building material inflation has always hovered lower than property selling prices, hence no evidence was found that it is a major contributor to the high housing prices on the market.
It further noted that a combination of weak domestic economic activities and government spending cuts, which has led to a reduction in construction activities, will make way for stable building material prices in the near future.
The strong local currency will also likely keep prices of most imported building materials stable, it added.