to property statistics for January 2016 from ooba, first-time buyers made up 54% of the home loan applications received by the bond originator.
The average purchase price increased by 6.4% year on year to R1 054 357, while the average purchase price for first-time buyers showed a smaller increase of 3.2% to R800 442.
Rhys Dyer, ooba’s CEO, says: “Average bond values are higher, which goes hand in hand with reduced deposit sizes. The average deposit fell by 17.1% year on year, while deposits from first-time buyers shrank by 25.4% year on year.
“Increased bond sizes and decreased deposit sizes show that lenders are still competing for market share in the home loan finance sector.”
However, Dyer cautioned that the property and home loan environments appear to be less buoyant going into this year.
Bank approval rates are only marginally up year on year, while month-on-month bank approval rates have declined. In the same way, average interest rates also improved year on year, but deteriorated slightly month on month.
Dyer says the effect of the recent interest rate hike has not yet been seen in ooba’s statistics.
“Considering the tougher interest rate environment, the poor economic growth forecast and the rising cost of living expenses, we believe that housing affordability is going to be the greatest challenge for the residential property market in 2016,” he says.
Dyer says all buyers can benefit enormously by qualifying for finance before putting in an offer on a property.