KZN PROPERTY - WHAT'S BEEN HAPPENING?
Category Residential Property News
Static? Certainly not the property market, particularly with first time home buyers...and a further attractive drop in the home loan rate.
There really is life out there in the property market! That's not hype or wishful thinking, those are the facts according to bond originator ooba's figures for the last three months.
Ooba's snapshot of Kwazulu-Natal's property landscape reveals, in particular, the buoyancy of the first time homeowner market during April to June 2020. In May for example, when current circumstances would suggest the reverse, there was a surge in first-time home buyers - 62.04 percent of buyers fell into that category! Not only that, but over those three months, the purchase price of first time home owner properties climbed steadily from R698,750 to R790,000 to R860,000. Why, you ask? Wakefields believes it's primarily attributed to the low interest rate - and now even lower - which meant this band of prospective homeowners could now afford to buy a slightly more expensive property. Marry our low interest rate with sellers who are choosing to price their homes very realistically, and that makes for a good match.
This, the fifth home loan rate drop this year, is the lowest rate implemented by the bank in nearly 47 years.
The bond approval figures by the banks was also encouraging. Ooba figures show the home loan approval rate by many banks, as averaging over the three month period, to 77,34 percent. The amount granted to first time home owners, too, has risen from R790,419 in April, to R869,335 in May, to R995,791 in June.
It's not only first time buyers who've been active. Although homeowners are predominantly buying property as their primary dwelling, Wakefields has also noticed a slight uptick in investment property buyers, and this, too, is likely to be attributed to the low interest rate.
It's good news. An active property market is crucial to our economy, and no more so than during these times. Buyers are out there, and they're looking for good value. First time buyers are realizing that, with the low interest rate and banks receptive to granting home loans, it is entirely possible for them to enter the property market. Other sectors like the R3m and under price range are transacting steadily, with the primary demand for those entering the market at under the R2m price range.
The 25 basis point interest rate drop this week makes up a total of a 300 basis points rate cut this year. This certainly makes a world of difference to both buyers and sellers, and Wakefields can see this playing out in the KZN marketplace.
Author: Anne Schauffer
