April Results from ooba Show That Market Conditions are Ideal for First-Time Home Buyers

The latest stats from ooba, South Africa’s biggest bond originator, show that the property market continues to grow and that it is currently an ideal climate for first-time buyers to get a foothold on the property ladder. 55% of ooba’s total intake of bond applications in April was from first-time buyers, which is the highest ratio on record.

In April, ooba’s Average Purchase Price at R947 189 continued to show steady year-on-year growth of 4.2% with the First-time Buyer’s Purchase Price recording a 9.6% year- on -year increase to R743 053.

The Average Approved Bond Size, at R803 811, continues to show year-on-year growth of 5.5% and the Average Approved Bond Size of First-time Buyers at R658 643 is 9.6% higher year on year. In April, ooba’s Approval Rate remained high at 74%, indicating that ooba continues to secure an approval for more than seven out of ten home loans that it processes.

“Taken together, all these statistics show a healthy lending environment and growing property market,” says Rhys Dyer, ooba CEO. “This is particularly relevant for first-time buyers, at a time when lending conditions are favourable, interest rates are still low – despite the recent increase – and there is further potential for property price growth in this bracket. This sentiment is echoed by the record number of first-time buyer applications which we received in April.”

For all property seekers, but especially first-time buyers, the benefits of using ooba’s prequalification service – oobaqualified – are significant. “Our free oobaqualification service incorporates a credit check and affordability rating so that when you make an offer on a property, you can be confident that the banks will approve your bond. ooba applies to multiple banks on your behalf, improving your chances of approval“ says Dyer.

Indicator Apr 2014 Apr 2013 Change Yr on Yr
(Apr 14 Vs Apr 13)
Mar 2014 Change Mnth on Mnth
(Apr 14 Vs Mar 14)
Avg purchase price 947,189 908,802 4.2% 978,637 -3.2%
Avg purchase price of first time buyer 743,053 677,712 9.6% 737,707 0.7%
Avg approved bond size 803,811 762,264 5.5% 829,581 -3.1%
Avg deposit (as % of purchase price) 15.1% (R143,378) 16.1% (R146,538) -6.2% 15.2% (R149,056) -0.7%
Avg age of applicant 37 37 No Change 37 No Change
Avg initial decline ratio (first bank decline) 46.0% 46.0% No Change 45.1% 0.9%
Ratio of applicants declined by one lender but approved by another 27.6% 24.9% 2.7% 29.4% -1.8%
Effective approval ratio 66.7% 65.5% 1.2% 68.2% -1.5%

Hello ooba news

In 2013, South Africa saw slow but steady recovery in the property market, paving the way for greater growth in the year to come.

 

Properties are languishing on the market as buyers remain cautious - but there are things sellers can do to get the best possible price according to SA's largest mortgage originator. Careen Mckinon, Provincial Sales Manager Western Cape at ooba, said home sellers have to be ultra savvy these days. Here are ooba's top tips to make your home as appealing as possible without breaking the bank.

The latest 'oobarometer' price index, first launched by ooba (formerly MortgageSA) in July this year, showed that average house prices have risen 3.4% in the month of September 2008, year on year.