select
|

Bigger bond sizes encouraging for buyers

Good news for home buyers is that the average approved bond size has risen by almost 6% in the past 12 months, while the average home purchase price has risen only 3,3%.

That's according to the latest statistics from BetterBond, SA's biggest bond originator, which show that the average approved bond size in the year to end-October was R893 000, and that the average home price during the same period was R1,12m.

Meanwhile in the first-time buyer sector, the average deposit required declined from 12,2% to 11,5% - and the actual cash amount required fell for the first time in many years, from R90 500 to R89 500, notes BetterBond CEO Shaun Rademeyer.

"The average home price in this sector has, however, grown faster than the average, showing a 4,68% increase in past 12 months to R775 000. This reflects higher demand in this sector, with our statistics showing that first-time buyers now account for 47,7% of home loan applications, compared to 46,6% in the previous 12 months."

However, he says, first-time buyers only account currently for 30% of home loan approvals, which indicates the difficulty that buyers in this sector have in obtaining loans and finalising purchases.

Rademeyer says first-time buyers who want to keep deposit cash requirements to a minimum are focusing on properties priced at less than R900 000, which also attract no transfer duty. "Our statistics show that the average home price paid by buyers aged between 20 and 30 in the year to end-October was R796 000, and that paid by buyers aged 30 to 40 was just over R1m.

"In the same period, the average deposit paid for a home costing between R500 000 and R1m was R79 000, while the average deposit paid for a home priced at R1m to R1,5m was R215 000 - suggesting that most purchases in the lower price category were made by first-time buyers in their 20s and 30s.

"The much higher average deposit in the higher price category speaks of older buyers, who tend to be repeat purchasers with proceeds from the sale of an existing home that they can and do use as deposits on their new properties. Our figures show, for example, that the average deposit being paid by buyers aged 40 to 50 is around R278 000, which is 22,4% of the average purchase price for that age group of R1,24m."


  Comment on this Article

  Please login to post comments

Post to my facebook wall
  
2000
Characters remaining


    Latest Property News
    • 20 Apr 2018
      Whenever changes in the political ecosystem of a traditional property market create uncertainty, smart investors begin to look elsewhere for new opportunities. Property experts at IP Global have analysed the trends and crunched the numbers to find new markets to explore in Europe and the United States.
    • 20 Apr 2018
      Energy and water self-sufficiency are increasingly important factors in home buyers’ choice of property – especially in Cape Town where the extreme drought of the past few years has made municipal supply costly as well as uncertain.
    • 19 Apr 2018
      During the last decade, rampant development has progressively transformed Cape Town’s property landscape with densification being the order of the day, but there are still one or two hidden gems like Scarborough which have retained their original character, offering an inimitable lifestyle and an attractive investment opportunity.
    • 19 Apr 2018
      The rental market is a cut-throat sector of the real estate market that waits for nobody. According to Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa, first-time renters need to be fully prepared before they even start the process of looking for a place to rent in order to avoid the disappointment of losing out on their ideal property.
    • 19 Apr 2018
      Choosing to buy your first home instead of continuing to rent is a big decision that will usually take some time to put into action, but the sooner you can save up a sizeable deposit, the closer you will be to reaching your goal.
    • 18 Apr 2018
      Selling your home is no small task and as you will quickly find out, there are a lot of misconceptions about the process. Gerhard van der Linde, Seeff's MD in Pretoria East lists the top 5 misconceptions when you are selling your home.
    • 18 Apr 2018
      The Cape Town municipality is now installing water-management devices at properties that have been non-compliant with the new level 5 water restrictions and there are talks of fines between R5,000 and R10,000 for households that use too much water.
    • 17 Apr 2018
      The recent interest rate cut has stoked the coals in the first-time buyer’s market. At least for the next two months until the next interest rate announcement, homeowners are guaranteed lower monthly instalments than in the previous quarter. But, is it wise to take out a 100% bond just to enter the property market while interest rates are low?
        
    X
    Subscribe to the MyProperty Newsletter

    Name  
    Last Name  
    Email Address  
    Email Frequency
    select
    X
    Share this Page

       
    For Sale Property
    Rental Property
    More Options
    About
    Connect with us
    FEEDBACK