Estate agencies are reporting improved lending appetite from banks. This is backed up by bond originator ooba revealing last month that the company recorded the highest home loan approval rate (76.9%) in Q1 2018 in the 10 years since the National Credit Act was enacted. Year-on-year, ooba reported a home loan approval rate 4.9% stronger than Q1 2017.
“These figures are certainly reflected in the market we’re experiencing,” said Richard Gray, Harcourts Africa Chief Executive Officer. “Another exciting sentiment shared by the report states that banks are increasingly more willing to lend the full value of a property without requiring a deposit. The average deposit over the entire market decreased by 6.4% year-on-year. For many first-time buyers the need for a sizeable deposit and stricter lending criteria implemented over the past few years greatly influenced the decision to buy. Having to apply for another loan to cover the deposit amount might put affordability of the home out of reach.”
Gray says currently, from a holistic perspective, the country is in a buyers’ market; but with banks letting go of the reigns more buyers will enter the market and create greater demand which ultimately leads to a far more beneficial environment for everyone.