Betterbond Property Brief - Nov 2023
Category infographics
New home loan applications in Q4 2023 saw a positive 7.6% increase, indicating stability and resilience in the residential property market. The number of new home loan applications is down 18% compared to Q4 2021, with prospective homebuyers hoping for lower interest rates in 2024.
The average home purchase price has increased by 5.4%, with the Western Cape consolidated its position as the top-priced region for residential properties. Six of the nine BetterBond regions recorded increases in average home prices for the 12 months to October 2023, with the Western Cape recording an increase of 8.3%. The highest age group has seen average price increases of between 29% and 32%.
The decline in average home prices has dropped to 1.6% (age group 21-30), 4.3% (age group 31-40), and 6% (age group 41-50), with the 41-50 age group's average premium dropping marginally to 40%. Interest-rate rises have led to increased average deposit values for home purchases, with the required R237,000 in October 2023 being 153% higher than just two years ago. The decline in home loan applications may have reached a trough in early 2023, with stability returning, including a slight improvement in October 2023.
Dr Roelof Botha Economist Perspective:
South Africa is making progress in addressing the energy crisis, with loadshedding levels and frequency expected to decrease during Q4 2023 and into 2024. Eskom generation improved in October, leading to a nine-day suspension of loadshedding. The country's energy crisis has been attributed to the growing capacity of embedded generation by private households and businesses, increased grid power availability, improved maintenance at power stations, and the return of generation units at Kusile power station. The country's natural splendor and a Rugby World Cup also contributed to the positive economic news, with lower oil prices and a strengthening rand exchange rate. Employment growth continued in 2023, with total employment nearly at pre-pandemic levels. The government's policy of relying on public-private partnerships promises to sustain job creation.
Author: Betterbond