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Over half of ooba bond applicants in January were first time home buyers

South Africa’s biggest bond originator, ooba – released their January figures which reflect that the property market has entered 2014 on a continuing high note, with ooba’s approval rate increasing by 3.0% year on year to 68.7%, which is the highest ratio on record since June 2008.   Property prices and bond sizes continue to show steady growth.

In January, the Average Purchase Price recorded by ooba was R956 112, up 6.9% year on year and 2.4% month on month. The Average Approved Bond was R801 391, 5.4% higher year on year, and 0.9% higher month on month.

The approval rate for January of 68.7%, showed a significant increase on December’s approval rate of 65.2% and January 2013’s rate of 65.7%.

These conditions are further indicated by the Initial Bank Decline ratio being lower both year on year and month on month at 44.7%, and the Ratio of Applications Declined by One Lender, Granted by Another showing a significant year-on-year and month-on-month increase of 4.5% and 4.3% respectively to 30%.

January also showed strong activity in the first-time buyers segment, with the First-time Buyers’ Purchase Price showing year-on-year appreciation of 9.9% and month-on-month appreciation of 6.4% at R754 487.

The Average Approved Bond Size for First-time Buyers was R650 000, which is 9.2% higher year on year. Of ooba’s total applications in January, 52.5% were from first-time buyers.

Full oobarometer analysis 

Indicator

Jan

2014

Jan

2013

Change yr on yr

(Jan 14 vs Jan 13)

Dec

2013

Change month

on month

(Jan 14 to Dec 13)

Avg purchase price

956,112

894,510

6.9%

933,528

2.4%

Avg purchase price

of  first time buyer

754,487

686,452

9.9%

708,989

6.4%

Avg approved bond size

801,391

760,143

5.4%

793,931

0.9%

Avg deposit (as % of purchase price)

16.2%

(R154,721)

15.0%

(R134.367)

8.0%

15.0%

(R139,597)

8.0%

Avg age of applicant

37

37

No Change

37

No Change

Avg initial decline ratio

(first bank decline)

44.7%

46.0%

-1.3%

46.9%

-2.2%

Ratio of applications declined by one lender but approved by another

30.0%

25.5%

4.5%

25.7%

4.3%

Effective approval ratio

68.7%

65.7%

3.0%

65.2%

3.5%




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