select
|

Marked increase in mortgage-dependent buyers

The past few months have seen a noticeable return of mortgage-dependent buyers to the Cape’s residential property market. 

So says Laurie Wener, Pam Golding Properties’ (PGP’s) MD for the Western Cape region, which includes the greater Cape Town metropolitan area. She says after a long period in which PGP has seen concluded transactions mainly dominated by cash buyers, in late 2013 and early 2014 there has been a resurgence of buyers entering the market with bond finance required to secure their purchase. However, this has not diminished the number of cash buyers still active in some areas.
 
“These mortgage-dependent buyers are mainly purchasing in the R3 million to R8 million price range,” says Wener, “with a typical loan to value ratio of around 50 to 60 percent. They include a number of family buyers, both existing Capetonians and those relocating from up-country provinces, who are looking to purchase homes in areas close to high-quality schools and well-established infrastructure. These include the Southern Suburbs and Atlantic Seaboard, as well as the Western Seaboard, where the beachfront lifestyle and value for money are seen as key appealing factors.”
 
Wener says the surge in mortgage-dependent buyers is a sign of confidence in the recovery of the residential property market, as well as indicating a slight easing of financial institutions’ lending criteria. Figures from mortgage originators ooba seem to bear this out, with their “oobarometer” for March 2014 pointing to an effective bond approval ratio of 68.2 percent – an increase of just under two percent year on year. Meanwhile ooba’s average purchase price has also show strong year-on-year growth of 8.3 percent, bringing this figure to R978 637 in March 2014.
 
“The improved access to mortgage finance and heightened activity from mortgage-dependent buyers only further entrenches our sense that the market has entered a positive growth phase,” says Wener. “Banks appears to be gaining confidence in lending, which is good news for all categories of buyers, and most especially for first-time buyers wishing to gain a foothold in the property market. The fact that this growth trend is being noted despite the recent interest rate hike, makes it all the more encouraging.”


  Comment on this Article

  Please login to post comments

Post to my facebook wall
  
2000
Characters remaining


    Latest Property News
    • 06 Dec 2017
      Homes situated within residential estates have become a more and more popular option across South Africa. There are, however, some emergency situations when heavily guarded access points to these communities can be more of a hindrance than a help.
    • 06 Dec 2017
      The average year-on-year house price growth for this year was likely to be slower than last year, despite year-on-year house price growth accelerating mildly in recent months.
    • 05 Dec 2017
      Located in dynamic and scenic Kenilworth is The Wentworth, a new development exclusively marketed by Greeff Properties.
    • 05 Dec 2017
      Today's rental market is a competitive place, so when you find the perfect spot it can be tempting to just sign on the dotted line and hope for the best. Sadly, there are more and more scammers who are taking advantage of this opportunity to dupe unsuspecting applicants out of their hard-earned cash.
    • 05 Dec 2017
      Gated communities are increasingly popular with home buyers due to the perceived safety these neighbourhoods offer. “These gated communities are popping up all over the country and while they certainly can boost security, a few issues have been cropping up – specifically referring to road usage,” says Bruce Swain, CEO of Leapfrog Property Group.
    • 04 Dec 2017
      If a property is purchased for the purpose of keeping it tenanted, maybe as a subsidy to an income or as a future retirement plan, it is important to ensure that the asset is taken care of in the best possible way.
    • 04 Dec 2017
      Estate agents in Cape Town are looking forward to a busy season despite the looming school holidays and festive season and many are reporting that there has been no slowing of enquiries for accessibly priced homes, especially in sought after areas like the Southern Suburbs.
    • 04 Dec 2017
      The property market has shifted notably over the last 18 months as the fall-out from the weak political and economic climate, poor growth and credit downgrades continue. The inevitable result, says Samuel Seeff, chairman of the Seeff Property Group, is that this rather good performing economic sector, is now also taking strain.
        
    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