The latest trend to manifest in the family-orientated Kempton Park is that black families are pooling their resources to overcome lending restrictions and buy shared properties.
So says Mario Grobler, principal of leading local agency Homenet OR Tambo who notes that these buyers are increasingly approaching the banks for bonds with collateral derived from two or three relatives or even two separate families. And they are being approved.
"Typically these buyers are qualifying for properties priced between R400 000 and R600 000. Many have realised that now is the time to buy given the slowdown in property prices, and freehold homes are their most popular choice," he says.
"Interestingly, despite the purchase being a combined one, the buyers themselves don't always actually reside at the property, choosing to rent or live elsewhere instead and leaving members their extended families in residence."
Such tactics have evolved out of necessity, says Grobler. "The National Credit Act and a tight economy are forcing people to innovate and the banks seem happy to grant loans to these 'collective buyers' as long as they meet the income and deposit criteria."
Meanwhile, Kempton Park property values are holding steady. Properties priced between R550 000 and R750 000 are also selling reasonably well as are sectional title properties priced at around R650 000.
Prospects for future growth are good due to the fact that the local municipality has embargoed further development for some time to come. Authorities cite excessive strain on existing infrastructure as the reason for their restrictions. Commercial re-zoning of homes has also been put on hold for the same reason and only projects approved 18 months ago are being allowed to be completed.
The local rental market, however, is also cooling off slightly as a result of overpricing. According to Grobler, many landlords have pushed up their rents in an effort to cover their own bond costs and priced themselves out of the market. Two-bedroom homes renting for around R4000 a month are however still in relatively high demand.
ISSUED BY HOMENET