Evolving market contributes to 'downward trend' in property prices

The changing mix of home loan applicants continued to favour the purchase of smaller, more affordable properties, which might be contributing to the downward trend in house price growth, mortgage originator ooba said yesterday.

Saul Geffen, the chief executive, said this was demonstrated in the higher median house price growth, which averaged close to 6 percent in the past three months.

Geffen added that the slowing in house price growth over the past five months also seemed to be a trend influenced by current economic fundamentals.

Statistics released by ooba yesterday revealed that last month house prices grew year on year by a marginal 0.7 percent to R836 055 but declined month on month by 1.3 percent from R846 863 in July.

However, Geffen said ooba's market experience was conflicting as its application intake and approved loans were significantly higher than the previous period.

Geffen said despite the slowing growth in house prices, it experienced a 28 percent year-on-year increase in the value of home loan applications and 44 percent year-on-year rise in the value of home loan approvals last month, indicating that the market was very active.

(Business Report)

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