South Africa property prices are expected to keep falling in 2011, after recording an average decline of 1.3 per cent in January, according to the Standard Bank Group.
The average price of a home in South Africa currently stands at R568,000 (£48,500), but are set to get even cheaper.
Johan Botha, a South Africa property analyst, told the press: "We believe that a further slowdown in the house price over the next few quarters is on the cards."
The annual rate of capital growth slowed from 2.3 per cent in January compared with 3.6 per cent in December, as a consequence of last month's price fall. South Africa property prices have been falling since September 2010, when the median price of a home in South Africa was up 8.3 per cent year on year.
According to the January 2011 FNB House Price Index report, the fall in property prices is being caused by a fall in demand, an oversupply of housing and a weak economic outlook.
The report said: "The slowing year-on-year growth rate in the average house price remains largely driven by weak demand growth, which in turn is the result of, firstly, a weak economy and its constraining effect on household income growth and, secondly, the high levels of household debt relative to disposable income. But strong residential supply, an overhang from the building boom of a few years ago as well as high levels of financial pressure related selling also plays a key role."