Property market is picking up

PSA - Property 2 - 1ooba, South Africa’s biggest bond originator recorded a 4.6 % growth in the average house price from R 868 174 in February 2012 to R 908 658 a year later.

The value of home loans approved through ooba in February 2013 was up 23 % on February 2012.
First-time home buyer activity continues to drive the market, with nearly 52 % of ooba’s applicants in February being first time home buyers.

The average house price for first-time buyers was up 5.4 % year on year to R 698 721 and up 1.8% month on month from R 686 452 in January.

“We continue to see high levels of activity in this market segment. It is a good sign and encouraging to see that a large proportion of buyers are in their early thirties and are keen to purchase their first home while market conditions are favourable,” says Saul Geffen, ooba CEO.

Despite the high number of first-time homebuyers, the average home loan deposit dropped substantially by 14 % year on year  to R 125,843, representing only 14 % of the average purchase price.

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“The slight relaxation in deposit requirements of the last few months has been positive for home buyers, as coming up with the funds for a deposit remains one of the major hurdles to obtaining home finance,” says Geffen. “It is also an indication of market competitiveness and confidence, as banks gradually ease lending criteria.”

The average approved bond size increased 7.6 % to R 782 815 in February this year from R 727 489 in February 2012.

The average initial bank decline ratio was 43. 6 % in February.