Mid-range South African property prices continued to rise on a year-on-year basis in July, increasing by 7.6 per cent, according to figures from the Absa House Price Index.

However, the rate of growth was at a slower pace than in previous months, suggesting that prices may be reaching their peak after a 7.7 per cent rise in June.

Year-on-year growth in value for large properties also rose by 4.7 per cent, following growth of 5.5 per cent in June.

According to the bank, house price growth in South Africa is likely to slow in the later months of the year as interest rates are expected to stay static.

"Year-on-year house price growth is forecast to slow down further in the months towards year-end, largely driven by the base effect of a recovery in property prices in the second half of 2009. Real house price growth in the rest of the year will be determined by nominal price trends as well as the course of consumer price inflation," it stated.

In June, data from the Lew Geffen Sotheby's International Realty website highlighted that British and European property investors' interest in South Africa remains strong, with traffic from UK residents to the site increasing 23 per cent.