Banks make lending easier

The property market may be in the doldrums, but there are pockets of demand and banks are easing lending conditions for home loans – including offering more 100% mortgages.

“Banks are looking to build sustainable customer relationships from an earlier stage and the home loan is ideal for that; it gives a platform for a 20-year relationship,” says Geoff Lee, managing executive of Absa Home Loans. Lee says that, in general, sellers are getting 8% to 12% less than what they’re marketing homes for, though selling periods remain the same.

Meanwhile, sectional title units are more popular than freehold. Andrew

Golding, CEO of PGP, says buyers want the lock-up-and-go or lowmaintenance lifestyle and it’s a more affordable entry to the housing market. Many higher-income people are opting to downsize and a sectional title property has lower running costs in terms of maintenance and utilities.

Most agencies are finding transactions are taking place mostly in the lower, more affordable end of the market.

The Remax Housing report for the third quarter of this year says homes of less than R400,000 continue to account for the largest portion of sales, nearly a third of the total transfers.