South Africa's building plans value falls 3% in first half of 2025: key insights and implications

The value of building plans passed (at current prices) decreased by 3.0% (-R1 445,6 million) during the first half of 2025 compared with the first half of 2024. 

This is according to the Selected building statistics of the private sector as reported by local government institutions published by Statistics South Africa(Stats SA) on Thursday afternoon.

It also showed that decreases were reported for residential buildings (-R1 546,0 million) and non-residential buildings (-R1 433,8 million). An increase was reported for additions and alterations (R1 534,2 million).

This statistical release contains information derived from the building statistics survey covering a sample of local government institutions involved in the approval of building plans and in the final inspection of buildings completed for the private sector.

The value of buildings reported as completed (at current prices) increased by 3.1% (R693,2 million) during the first half of 2025 compared with the first half of 2024. In this regard, increases were reported for residential buildings (R533,5 million) and non-residential buildings (R461,8 million).

However, a decrease was reported for additions and alterations (-R302,2 million).

The July 2025 Preferred Supplier and Competitor Survey (PSS) report released earlier this month highlighted delays due to late payments, political interference, community disruptions, and a shortage of skilled project managers, especially in provinces like KwaZulu-Natal, Limpopo, and the Free State.

It provides insights into construction activity and material supplier dynamics across South Africa. It is based on a sample of 13 projects worth approximately R1.2 billion, mostly awarded late last year, with a focus on education, housing, and road infrastructure. 

The report tracks the Market Exposure Rate (MER) of construction material suppliers, gauging their participation based on project value.

It showed that construction material prices remained relatively stable, with no major price hikes reported, though G1 stone remains in short supply. The use of imported cement (notably Simba Cement from Vietnam) is said to be increasing, particularly in KZN. 

Last month, Trading Economics said the value of building plans approved in South Africa dropped by 13.3% year-on-year to R 7,496 million in June 2025, following a 13.2% jump in the prior month. It said the decline was largely driven by the non-residential segment, which dropped 48.6% compared with a 4% fall previously.

Additions and alterations had fallen slightly by 0.1% versus a 52.1% increase in May, while residential approvals rose 2.4%, down from 3.4% then. 

Last week, Industry Insight, which provides project lead information to the construction industry, said that in July, the local civil tender market showed its first significant recovery in over a year, with estimated values surging 53 percent year-on-year to R8.2 billion after 14 months of steep declines. It said Mpumalanga led with R1.6 billion, up 147 percent, followed by strong gains in Gauteng, Northern Cape, and Western Cape.

The rebound was driven by a rise in large-scale Grade 9 projects, alongside growth in Grade 8 and Grade 4 tenders. Despite this uptick, overall tender values for January to July 2025 were down 23 percent year-on-year to R41.9 billion, with severe drops in KwaZulu-Natal, Limpopo, amongst other provinces. 

On the construction activity front, R11.1 billion in project awards were recorded in June this year, a 53% increase from May and 54% higher year-on-year, mostly driven by civil projects (R9.2bn). However, building project awards declined 54% y/y.

Civil activity was most prominent in Limpopo, Gauteng, Mpumalanga, and the Northern Cape, while tender activity fell sharply by 65% y/y, with only 197 tenders issued.

In conclusion, the report said that while construction project awards surged, the industry continues to face operational and funding challenges, regional disparities in activity, and fragile supplier-contractor relationships, especially in the public sector.

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