PROPERTY: Significant House Price Growth Recorded
Recent Western Cape Business News
According to the latest statistics released by ooba – Cape Town-based bond originator - property prices showed positive year-on-year growth of 5.6% in April 2012. According to Saul Geffen, CEO of ooba, April was the sixth consecutive month of positive year-on-year property price growth.
The April oobarometer price index reveals that the average house price rose to R870 070 from R823 483 a year earlier. In addition to this growth, the average purchase price of the first-time buyer continues its upward trajectory, showing year-on-year growth of 8.2% to R676 837, from R625 252 in April 2011.
According to Geffen, the growth in the first-time buyer purchase price seems to be supported by sustained first-time buyer activity. He says that 50.9% of the applications during the month consisted of first-time buyers. This is in comparison to the 47.7% recorded in March 2012. “April was also the twelfth consecutive month of positive year-on-year property price growth for first-time buyers.”
The average approved home loan size is also showing both a year-on-year increase of 3.5% and a month-on-month increase of 1.3%.
Geffen says that the consistent property price growth and the improved bank approval rates suggests improved confidence in the property market, and this sentiment is underpinned by higher home loan approval rates.
The ratio of applications declined by one lender but granted by another for April 2012 is showing a significant year-on-year increase to 26.7% of all declined deals. Geffen says that essentially 27% of all declined deals are being approved by other lenders and this translates into an effective approval ratio of 67% of all applications, which is the highest ratio of approvals ooba has recorded for over 3 years.
ooba also reported 45% growth in its approved home loans for April 2012 over the corresponding period in the prior year.
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