First-time home buyers surge in 2010 | Fin24
 
  • Mpumalanga Mine

    Constitutional Court rejects coal mining company’s attempt to appeal – but the saga isn’t over.

  • Audit Outcomes

    Turnaround plans had virtually no impact for ailing parastatals, the Auditor-General has found.

  • Battery Power

    Gordhan: Government intends to sign off soon on a "world class" battery storage project.

Loading...

First-time home buyers surge in 2010

Feb 21 2011 11:56
I-Net Bridge
Johannesburg - First-time buyers made up almost half of all home loan applications in 2010, a bond originator said on Monday.

Research by ooba showed that in 2010, the proportion of first-time buyers as a percentage of total applications increased to 47.61%.
 
This is the highest since ooba began tracking the statistics, and is a 15.96% increase on the proportion of first-time buyers since these records began in July 2005.

The figure, however, was influenced by the reduction in the overall number of property investors.

Saul Geffen, CEO of ooba, said the change in profile of home buyers is a welcome development for the housing market.

"Higher levels of activity among first-time buyers are generally a positive indicator for the housing market, as demand increases and there are positive knock-on effects," Geffen said.

"With capital growth having curtailed and buy-to-let investors having fallen away considerably, the relative proportion of first-time buyers would naturally increase," he said.

The reduction in interest rates of 650 basis points since 2008 has also been a contributing factor.

"With rates now standing at a 30-year low, improved affordability has enabled many would-be homeowners to take the leap, as the cost of servicing a bond has reduced considerably," he said.

Other factors included an easing in lending conditions, relatively low property price growth compared with recent years, low inflation rates and some real wage growth.

He said potential first-time buyers should aim to put down a deposit, as those who do so are more likely to get their home loan approved and also obtain a more favourable interest rate on their bond.

ooba  |  property  |  property market
NEXT ON FIN24X

 
 
 

Read Fin24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
0 comments
Comments have been closed for this article.
 

Company Snapshot

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...

Voting Booth

What do you think about private healthcare in SA?

Previous results · Suggest a vote

Loading...