The Current Property Market - New Stats Revealed
Category Principal's Message
* The loan-to-purchase-price ratio for residential properties in South Africa increased far more in the second quarter of the year than at any time since 2008, according to the new FNB property barometer.
* This occurred as the value of home loans granted in South Africa grew by an unusually quick rate of 4.9% in August.
* Nevertheless, despite larger loans and more of them, overall house prices are still in decline when corrected for inflation.
The latest FNB Property Barometer showed that the loan-to-purchase-price ratio improved from an average of 88% in the second quarter of 2017 to 90.6% in the second quarter of 2019.
This indicates that the average house purchaser is laying out a deposit of less than 10%, this is for both first-time purchasers and those who used proceeds of properties sold to buy new homes.
Concurrently, the credit amount given to South Africans, the value of mortgages overall, grew by 4.9% in August, the highest rate of growth since November 2010.
Positively, property demand has shown mild signs of improvement across all price segments. At the same time, sellers have begun withdrawing properties on the market for resale amid less than favourable selling conditions. This has somewhat narrowed the demand-supply gap. Nevertheless, there is still a robust supply of new stock, as well as emigration-related sales.
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Author: Prime Property Marketing