(Click here for FNB's September house price index.)

House prices are set to rise again in the near future, Absa said on Wednesday.

In its latest house price index, it found that nominal year-on-year price deflation in the housing market had slowed down further in September 2009.

"If the latest trends are to continue, house prices may start to rise on an annual basis before the end of the year," Absa's senior property analyst Jacques du Toit said.

On a month-on-month basis, prices continued to rise in September after reaching a lower turning point in April this year.

Middle-segment down by 0.3 percent

Absa said that middle-segment house prices were down by a nominal 0.3 percent year-on-year to R966 300 in September 2009 from a revised -1.1 percent year-on-year in August.

On a monthly basis, house prices increased by a nominal 0.8 percent in September, from a revised increase of 0.9 percent in August.

Absa said that by September, the average house price was 3.4 percent up on the low reached in April 2009.

In real terms, house prices in the middle segment were down by 7.1 percent year-on-year in August (versus -8.2 percent year-on-year in July).

Prices of small houses (80m² - 140m²) were a nominal 4.2 percent year-on-year lower in September (versus -4.4 year-on-year in August after revision).

Price of average small house now R651 400

"This brought the average nominal price of houses in this segment to about R651 400 in September," Du Toit said. In real terms, the average price of houses in this segment of the market was 10.2 percent year-on-year lower in August, after declining by 10.6 percent year-on-year in July.

"This brought the average nominal price of houses in this segment to about R651 400 in September."

Du Toit said that in real terms the average price of houses in this segment of the market was 10.2 percent year-on-year lower in August, after declining by 10.6 percent year-on-year in July.

With regard to medium-sized houses (141m² - 220m²), the average nominal price declined by 5.2 percent year-on-year in September (versus -4.7 percent year-on-year in August after revision), which brought prices in this category of housing to an average of R901 700.

According to Absa, this translated into a real price decline of 10.4 percent year-on-year in August (versus -10.2 percent year-on-year in July).

Large house price up by 2.7 percent

Absa said the average nominal price of large houses (221m² - 400m²) was up by 2.7 percent year-on-year in September (up 1.9 percent year-on-year in August after revision).

"This brought the average nominal price to R1.416-million in September, which was R53 500 higher after bottoming at a level of R1.362-million in February this year," Du Toit said.

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