Property market shines
THERE were several positive indicators for the residential property market, bond originator ooba said this week.
Simultaneously, there had been a decline in the size of the deposit required.
"The average purchase price in July 2012 was R846863, up 3.1% from R821579 in July 2011," said ooba.
For first-time buyers, the average purchase price had increased by 7.8% year-on-year, from R609417 in July last year to R657069 in July this year.
However, the month-on-month purchase price statistics did indicate a trend of slowing growth in property prices, in line with slowing economic growth.
"Of our total intake of bond applications in July, 53% were from first-time buyers, a 5% increase from last year," says Rhys Dyer, ooba chief operating officer.
The average home loan deposit had reduced from 15.1% of the purchase price in July last year to 12.6% of the purchase price in July this year.
The approval rate had risen to in effect 65.3% of loan applications, from 64.2% last year.
This increase was driven by a "healthy improvement" in the percentage of applications which were declined by one bank, but approved by another, from 23.1% of applications last year to 27.6% this year.
The Reserve Bank's decision to drop interest rates in July by a further 0.5% was likely to add a further mild stimulus to the lending environment, improving buyers' ability to qualify for loans.