Building Costs Per Square Metre in Northern Cape Province, South Africa 2025 to 2026: A STATSSA P5041.1 Guide

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Executive Summary

This comprehensive analysis provides a detailed breakdown of building costs within the Northern Cape province of South Africa for the period spanning 2024 to 2025, with projections for 2026. The data is sourced exclusively from Statistics South Africa’s Selected Building Statistics of the Private Sector report (P5041.1), specifically Tables 12 and 22 for April 2025. This report is an essential guide for developers, architects, quantity surveyors, investors, and policymakers, offering critical insights into the economic dynamics of the Northern Cape’s construction sector. The analysis reveals a province experiencing significant contraction in new building activity, particularly in the non-residential sector, while the market for additions and alterations demonstrates remarkable resilience and growth. The calculated cost-per-square-metre metrics provide a vital benchmark for budgeting and financial planning in a unique and challenging economic environment.

1. Introduction and Methodology

1.1. Understanding the STATSSA P5041.1 Report

The Statistics South Africa P5041.1 report is a monthly publication that captures data on building plans passed and buildings completed by larger municipalities. It is a leading indicator of construction activity and investment in the country. The data is categorized by type of building (residential, non-residential, additions/alterations) and is presented in three key metrics:

• Number: The quantity of units (e.g., number of dwelling-houses).
• Square Metres: The aggregate gross floor area.
• R’000: The total reported value of the projects at current prices (i.e., not adjusted for inflation).

1.2. Scope and Limitations of This Analysis

This article focuses solely on the Northern Cape data from the provided excerpts of the April 2025 report. The analysis covers the cumulative period from January to April for both 2024 and 2025, allowing for a robust year-on-year comparison. The key calculations for cost per square metre are performed using the following formula:

Cost per Square Metre (R/m²) = Total Value (R’000) / Total Area (m²)

It is crucial to note the following limitations:

• Current Prices: All values are in current prices (nominal Rand). This means the figures include the effects of inflation and do not reflect real growth or decline in physical output.
• Cumulative Data: The Jan-Apr data represents activity over four months, not a full year.
• Geographic Coverage: Data is only for “larger municipalities,” potentially excluding smaller towns and rural projects.
• Sample Data: The values are based on reported plans and completions, and may not capture all informal or unpermitted construction activity.

1.3. Northern Cape Construction Market Overview (Jan-Apr 2024 vs. Jan-Apr 2025)

The Northern Cape’s construction sector displayed a stark dichotomy in the first four months of 2025 compared to the same period in 2024.

• Total Building Plans Passed (Value): Decreased by 20.7%, from R317.658 million to R251.784 million.
• Total Buildings Completed (Value): Experienced a severe decline of 48.8%, falling from R122.936 million to R62.917 million.

This indicates a significant slowdown in new construction investment and a substantial drop in projects reaching completion, reflecting potential challenges in project execution, financing, or material supply chains.

2. Analysis of Building Plans Passed

This section analyses intended construction, as reflected in plans approved by municipalities. This is a forward-looking indicator of construction investment.

2.1. Residential Buildings

Table 1: Building Plans Passed – Residential Buildings (Jan-Apr 2025)

*Other residential buildings include institutions, boarding houses, hostels, and tourism accommodation.

Analysis: The data shows plans for 77 new residential units, with a total value of R113.351 million.

• The Average Cost of Building a House in the Northern Cape, based on plans passed, is R1,472,091 (R113,351,000 / 77 units).
• The Average Cost Per Square Metre for new residential construction is R8,876.64.
• There is a clear economies-of-scale effect visible. Smaller houses (<80m²) have a significantly higher cost per square metre (R9,900.18) compared to larger dwellings (R8,820.75). This is often due to the fixed costs of elements like kitchens and bathrooms being spread over a smaller area.

Year-on-year, the value of residential plans passed fell dramatically by 36.1%, signalling a sharp pullback in investment for new housing developments.

2.2. Non-Residential Buildings

Table 2: Building Plans Passed – Non-Residential Buildings (Jan-Apr 2025)

*Other non-residential includes churches, schools, hospitals, clubs, etc.

Analysis: The non-residential sector shows an extreme contraction, with total value plummeting by 66.0% year-on-year.

• Despite the massive decline in volume, the cost per square metre across all non-residential sub-categories is remarkably consistent, averaging R9,892.86.
• This suggests that while developers have drastically scaled back the number and size of new projects, the underlying unit cost of construction (materials, labour, professional fees) has remained high and uniform across office, industrial, and other building types.

2.3. Additions and Alterations

Table 3: Building Plans Passed – Additions and Alterations (Jan-Apr 2025)

*Other buildings include alterations to other residential and non-residential buildings.

Analysis: This category is the sole bright spot in the plans data, with the total value soaring by 53.2% year-on-year to R116.788 million—now larger than the entire new residential sector.

• The cost per square metre for alterations is high, averaging R10,488.02.
• Alterations to “Other Buildings” (e.g., commercial retrofits, upgrades to hotels) are particularly expensive at R12,237.76/m², likely due to complex integration with existing structures, higher-spec finishes, and potential operational downtime costs.
• This surge indicates a strong market trend towards renovating and upgrading existing building stock rather than undertaking new greenfield construction, a common trend in uncertain economic climates.

3. Analysis of Buildings Reported as Completed

This section analyses work that has physically finished and been signed off. This is a lagging indicator, showing what has actually been delivered to the market.

3.1. Residential Buildings

Table 4: Buildings Completed – Residential Buildings (Jan-Apr 2025)

*Other residential buildings include institutions, boarding houses, hostels, and tourism accommodation.

Analysis: The completion data reveals an even starker picture than the plans data. Only 13 residential units were completed in the first four months of 2025, a fraction of the 77 that had plans passed.

• The Average Cost of a Completed House was R1,867,462 (R24,277,000 / 13 units).
• The Average Cost Per Square Metre for completed homes was R9,892.83.
• The value of completed residential work collapsed by 40.9% year-on-year. The high cost per square metre for completions (R9,892.83) compared to plans passed (R8,876.64) could reflect cost escalations during the construction phase, differences in the mix of projects completed versus those just starting, or the inclusion of site works, landscaping, and other costs not fully captured in the “plans passed” value.

3.2. Non-Residential Buildings

Table 5: Buildings Completed – Non-Residential Buildings (Jan-Apr 2025)

*Other non-residential includes churches, schools, hospitals, clubs, etc.

Analysis: Completions in the non-residential sector were virtually non-existent, with a catastrophic -87.6% year-on-year decline in value. Only R3.463 million worth of space was completed.

• The cost per square metre for the minimal completed work (R9,894.29) is perfectly aligned with the cost estimated in the plans passed (~R9,893), confirming the stability of these unit costs in the market.

3.3. Additions and Alterations

Table 6: Buildings Completed – Additions and Alterations (Jan-Apr 2025)

*Other buildings include alterations to other residential and non-residential buildings.

Analysis: While the value of completed alteration work fell by -34.9% year-on-year, it remained a significant portion of the total completed work (R35.177 million out of R62.917 million total).

• The cost per square metre for completed alterations (R10,134.14) is slightly lower than the planned cost (R10,488.02), which could indicate that planned budgets for complex alteration projects are often cautious.
• As with plans, alterations to “Other Buildings” (commercial) are more expensive per square metre (R10,558.62) than residential alterations (R10,006.39).

4. Synthesis and Interpretation for 2025-2026

4.1. Summary of Key Cost Metrics

Table 7: Summary of Average Building Costs per Square Metre (Jan-Apr 2025)

For accurate budgeting in 2025-2026, stakeholders should use the completed building cost per square metre as the most reliable benchmark, as it reflects final realised costs.

• New Construction Benchmark: R9,890 – R9,895/m²
• Alterations Benchmark: R10,000 – R10,600/m²

4.2. Market Trends and Economic Implications

The data paints a picture of a construction sector in the Northern Cape under significant strain:

1. Investment Strike in New Builds: The drastic decline in both plans and completions for new buildings (residential and non-residential) suggests low business confidence, difficulty in securing financing, or a lack of demand for new space.
2. Renovation-Led Market: The strength of the additions and alterations sector indicates a pragmatic shift. Businesses and homeowners are choosing to upgrade and repurpose existing assets rather than commit to the higher risk and cost of new construction.
3. Sticky Construction Costs: Despite a likely reduction in demand, the cost per square metre has not decreased. This suggests that input costs (materials, fuel, skilled labour) remain high and inelastic, preventing a drop in unit prices even as volume collapses.
4. Pipeline Constriction: The fact that completions are much lower than plans passed indicates a broken pipeline. Projects are being approved but are either delayed, stalled, or cancelled before completion, which has knock-on effects for employment and related industries in the province.

4.3. Recommendations for Stakeholders

• Developers & Investors: Exercise extreme caution with new development projects. Focus on feasibility studies with construction costs anchored at R9,900/m²+. Consider the potential of the refurbishment and retrofit market, which appears more active.
• Quantity Surveyors & Architects: Use the cost per square metre benchmarks provided here as a starting point for preliminary estimates in the Northern Cape, but factor in a high contingency (15-20%) due to market volatility and potential supply chain issues specific to the region.
• Government & Policymakers: The data signals a need for intervention to stimulate the construction sector. This could include expediting public sector infrastructure projects, providing incentives for energy-efficient retrofits, or reviewing regulatory processes to unblock stalled projects.

5. Conclusion

The Northern Cape’s building and construction sector, as detailed in the STATSSA P5041.1 report for early 2025, is at a crossroads. The province is characterized by a severe downturn in new construction activity, with building completions halving compared to the previous year. However, this is juxtaposed with a robust and growing market for building alterations and additions. The key takeaway for anyone involved in the built environment within the province is the critical importance of cost benchmarking. The analysis confirms that the average cost to build per square metre in the Northern Cape is approximately R9,890 – R9,895 for new structures and R10,000 – R10,600 for renovation work. These figures, derived from actual completed project data, serve as an essential guide for financial planning, risk assessment, and strategic decision-making for the remainder of 2025 and into 2026. Stakeholders must navigate this market with a strategy that acknowledges the high-cost, low-volume environment and the shifting preference towards upgrading existing assets over new development.