Buyers' confidence in Boksburg's residential market is growing and property sales are consequently picking up speed.
Denver Ramnath, who holds the local Aida franchise, reports that this movement is largely being driven by an improved home loan approval rate - “which is now at around 60% of applications compared with only about 40% two years ago”.
It also helps, he says, that an increasing number of local buyers are now realising that they need to save a deposit of at least 10% of the purchase price to obtain a loan, although new entrants to the market are still struggling to save large enough deposits because many of them also have to pay for rental accommodation in the interim.
"We notice, however, that banks are starting to build up their market shares in the entry-level market, where prices range up to R600 000. Prospective buyers earning between R9 000 and R16 000 per month with clean credit records are increasingly obtaining 100% loans for homes in this price category in previously disadvantaged areas."
Meanwhile, self-employed people are still finding it difficult to obtain home loans, even if they have saved up substantial deposits, and Ramnath says there is clearly a disconnect between government's encouragement of entrepreneurs who can create jobs and the lack of finance available to such people.
"We currently have a case of a successful garage owner who has saved R200 000 for a deposit, yet because he is a small business owner he is struggling to obtain a home loan for a modestly-priced property," he says
However, overall higher demand in the residential market is now leading to shortage of stock in certain sectors of the Boksburg market. Ramnath says most sales are currently taking place in the R500 000 to R1,2m price range and that stock at the lower end of this range is running low, with any available units usually finding qualified buyers very quickly."
Compact townhouses of about 50sqm and with two bedrooms are selling from R500 000 upwards, while R1,2m will buy a three-bedroom family home with two bathrooms, a pool and double garage. Upmarket clusters of around 200sqm under roof in secure areas are selling at prices of up to R1,5m.
Article from: www.aida.co.za
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