The September oobarometer has shown a 1,8% rise in house prices year-on-year, ooba (formerly MortgageSA) said on Monday.
”The September oobarometer continues to reflect an improvement in year-on-year house prices,” Saul Geffen, chief executive of ooba, said in a statement.
”This is the fourth consecutive month that the oobarometer has reported rising house prices and is clear evidence that the market is on the road to recovery,” he said.
According to the oobarometer, the average purchase price was R806Â 494 last month compared to R791Â 478 in September 2008.
The month-on-month average purchase price also increased by 1,4% from R795Â 241 in August this year.
”Ooba also saw a surge of 21% in the month-on-month value of approved bonds in September as improved affordability and sentiment translated into increased transaction volumes.
”This was supported by improved lending appetite,” Geffen said.
Ooba has recorded increases in the value of approved bonds for the past five consecutive months.
It said the year-on-year average approved bond size had increased by 8,2%, from R651Â 707 in September 2008 to R705Â 744 in September this year.
The month-on-month bond size had also increase by 15,5% from R611Â 026 in August this year.
There had been a substantial reduction in the average deposit as a percentage of purchase price in both the month-on-month data and the year-on-year data as banks loosened lending criteria and offered 100% loans, the oobarometer found.
”The main contributor to the significant drop in average deposits as a percentage of purchase price is a result of the shift in banks lending criteria to lower deposit requirements, with all four big banks now offering 100% loans,” Geffen said.
”The improved appetite to lend will support the increased demand for property as transaction volumes continue to pick up,” he said.
According to the oobarometer, the year-on-year average deposit as percentage of purchase price showed a 28,9% reduction.
Buyers now required an average deposit of 12,5% compared to 17,6% last year.
There was a significant month-on-month reduction from an average deposit of 23,1% in September.
The oobarometer showed that the average purchase price of a first time buyer was R575Â 811 in September this year compared to R554Â 688 in September last year showing a 3,8% rise.
This was also an increase of 4,7% from R549Â 949 in August this year.
The average bank decline ratio showed an improvement and was now at 48,4%, a 3,6% improvement on the previous year’s 52%.
”One of the biggest drivers of a market recovery is bank lending and we have seen an improvement in competitiveness between the banks over the past five months and an increase in approval rates,” Geffen said.
”Banks are now targeting non-bank clients and rate concessions are becoming more aggressive,” he added. — Sapa