WINDHOEK and Swakopmund experienced subdued building activity in January, indicating a concerning start to the year.
Windhoek recorded a decrease in approved building plans and completed projects compared to the previous month and year, with 76 buildings plans approved from a pool of 122 received in January 2024, compared to 105 plans approved in December 2023.
According to economic analysts Simonis Storm Securities, this marks a year-on-year decrease of 11,6% and a month-on-month decrease of 27,6%.
“The newly approved building plans collectively have a total value of N$53,8 million,” says Simonis, adding that a total of 31 building projects were completed in January 2024,” the analysts say.
This is an increase from 23 recorded in December 2023, but a decrease from 67 projects completed in January 2023.
The total value of the 31 completed projects is N$47,4 million.
During January this year, the highest value of approved building plans by construction type was for houses, totalling N$41,8 million, followed by additions valued at N$8,6 million.
“Analysing house plans approved by area, data from the City of Windhoek shows that Otjomuise had the highest value for the month, amounting to N$18,2 million,” Simonis says.
The high number of approved building plans at Otjomuise can largely be attributed to the recent availability of serviced erven in the Extension 5 area.
“This availability has attracted numerous developers to invest in the area, leading to a surge in approved building plans.”
Swakopmund also saw a decrease in approved building plans and a significant decline in completed projects, indicating a slowdown in construction activity.
Between 18 December 2023 and 15 January 2024 a total of 22 building plans were submitted to the Swakopmund municipality, with an estimated total value of N$43,5 million.
In January 2024, 25 building plans with a combined value of N$29,8 million were approved – a decrease from the 80 plans approved in December 2023.
During the same period, six building projects were completed at the Municipality of Swakopmund, with a total value of N$4,6 million.
This marks a significant decrease from the 42 and 76 completed projects recorded in January and December 2023.
Out of the six completed projects, four were for new residential buildings, while the remaining two were for additions and alterations.
The Swakopmund municipality raised N$158 202,94 from building application fees and N$5 005 from building compliance fees.
“The trends observed in the two cities suggest a worrying outlook for the construction sector, influenced by economic uncertainty where cyclical sectors like construction and materials typically face reduced demand.
“Additionally, the current high-interest rate environment further dampens activity,” Simonis says.
– email: matthew@namibian.com.na
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