Local property market continues to grow at a healthy sustainable rate
The local property market is continuing to grow at a healthy sustainable rate, with low interest rates and high debt levels having some positive and negative effects on house prices.
Household debt levels are relatively high currently, with about 78% of disposable income going toward debt repayment commitments, thats according to statistics from the South African Reserve Bank.
Despite this, the property market has continued on its path to recovery. FNB reports that property prices have grown by 4.5% in the last 12 months. ABSA says the growth rate over 12 months has been 2.9%.
Meanwhile, record low interest rates are helping to boost buyers’ affordability levels.
With the prime interest rate 9.5%, down from 15.5% in 2008 buyers are now able to qualify for large bond amounts.
With a salary of R20,000/pm, as buyer, you could now qualify for a bond of up to R640 000.
In 2008 (when the prime rate was 15.5%), you could only qualify for a maximum bond of R440k, with a salary of R20,000/pm.
With regards to home loans, while 100% bonds are still available most buyers are required to put down a deposit of about 5%-10%.
Click Here to apply for a home loan pre-approval, to see how much you can qualify for.
Category : Property News