[imagesource:here]

Despite the hardships of the past 18 or so months, there’s been a surge in the number of South African first-time homebuyers.

Given the trouble we’ve seen with renting out residential properties during the COVID-19 pandemic, one hopes those buyers intend to live in the homes they’ve bought.

Dr Andrew Golding, chief executive of the Pam Golding Property group, tells BusinessTech that the age of our first-time homebuyers is around 34 or 35.

What is of particular interest is the average price paid by these buyers:

[It] broke above the R1 million mark for the first time on record in January 2020, then declined marginally before surging in June 2020 as the hard lockdown regulations were eased.

In January this year (2021), the average price paid by a first-time home buyer rose to a new record high of R1.138 million before easing back to R1.12 million in April (2021).

With mortgage lending rates being as low as they are – 7% in many instances – getting a 100% bond can still mean that the monthly payments are less than the cost of renting, or around on par.

As an example, paying a bond of R1 million over 20 years, with no money down upfront, would equate to a monthly repayment of around R7 750.

Then again, R1 million doesn’t get you much these days.

In June 2020, 67,5% of bond applications were taken out at 100% of the property value, which is by far the most in recent history.

To read that full report, head here.

[source:businesstech]