Property Investment Cape Town
We are looking for
Property Developers!

Invest: it’s a good move!

It’s been a great year for those who decided to invest in property and, if the experts are to be believed, there is every chance that 2015 is going to be another bumper year.

Bond originator giant BetterBond Home Loans reported that it has this year secured home loans to the tune of R36.5-billion, of which 48% were for first-time buyers.

The company’s figures also show that the average home purchase price in its portfolio rose by 5.42% year-on-year in November, to R917 641, while the average purchase price for first-time buyers grew 3.94% to R643 372. At the same time however, the percentage of purchase price required as a deposit declined to 16.64% on average – and to an average of 8% in the case of first-time buyers – which meant that buyers required less cash to be able to complete their transactions.

The percentage of loans rejected outright continued to drop to the 30% mark as, according to the group’s CEO Shaun Rademeyer, the banks continue to pursue new mortgage business.

Well balanced

By the sound of things, the residential property market is fairly well balanced at the moment and according to Lew Geffen, Chairman of Sotheby’s International Realty, prices are expected to rise by an inflation-beating 8% to 9% in the next 12 months. Prices in gated estates and certain “hot pockets” are likely to increase even further.

“The latest decision by the SA Reserve Bank to leave interest rates unchanged, combined with lower fuel and food prices, will obviously boost consumer sentiment and the demand for residential property going into the new year,” he says.

“However, the economy is still weak and, over the next 18 to 24 months, we foresee that interest rates will have to move somewhat off the current low levels to attract investment and create employment – and while that will probably not do much to slow housing demand, it will affect housing affordability.”

Get off the fence

While banks may have upped the ante by granting more bonds this doesn’t mean that they are going to throw caution to the wind and start handing out home loans to all and sundry, or agree to finance every property that is sold. Banks are still not keen on the idea of handing over cash for what, in their opinion, is an overpriced home.

Overall the property picture is looking rosy and those who have been undecided about buying a home (particularly first-time buyers) could be well advised to get off the fence and invest.

http://www.privateproperty.co.za/news/points-of-interest/invest-its-a-good-move.htm?id=2648 – Private Property

Leave a Reply

Your email address will not be published.