Activity in the construction sector continued to drop as Windhoek and Swakopmund experienced a combined contraction of 33,6% year on year (y/y) in plan approvals in April 2023.
According to statistics, year-to-date, (January to April), an average of 151 plans were approved per month, whereas for the same period last year, 214 plans were approved per month.
The decrease in building plan approvals is partly explained by the City of Windhoek receiving 191 plans year to date (YTD) on average per month, compared to 222 plans received on average per month for the same period last year.
Building plan approvals have decreased from 283 plans in April 2022 to 188 plans in April 2023 for Windhoek and Swakopmund combined.
Simonis Storm Securities says the driver of this decrease is Swakopmund, decreasing by 53,7% y/y, while Windhoek experienced 23,4% less approvals in April 2023 compared to April 2022, with approvals decreasing from 188 to 144.
On a monthly basis, Windhoek and Swakopmund’s approvals in building plans experienced a decline of 26,2% month-on-month (m/m) and 32% m/m respectively, resulting in an overall decrease of 27,7% m/m.
According to Simonis, building completions also remain on a downward trend. Completions decreased by 27,4% y/y in April 2023 compared to April 2022.
“Only 90 projects were completed, which is the lowest since July 2021, when only 43 buildings were completed in both Swakopmund and Windhoek. These completions were concentrated in the residential segment of the market,” said Simonis.
The majority of building plans approved in Windhoek and at Swakopmund were in the additions segment of the market, however, only composed 26% of the total value of plans approved.
Notably, 10 commercial and 70 residential plans were approved with the largest value of N$62 million and N$60 million, respectively. The approvals among these three categories account for 97% of the total value of plans approved.
In April 2023, there was a significant increase in the value of completed projects compared to March 2023, with a 48% m/m increase, albeit with only 90 projects completed in Windhoek and at Swakopmund combined.
Simonis says of the N$94 million worth of completed projects in April, N$75 million were residential, N$14 million were commercial, and N$5 million were additions.
– email: email@example.com