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ooba stats points to positive 2013 start

ooba stats points to positive 2013 start
19-07-13 / Staff Writer

ooba stats points to positive 2013 start

The latest statistics from ooba, South Africa’s biggest bond originator, show the average house price reached R894 510 in January 2013, up 5.2% from R850 589 in January 2012. Month on month, the average house price increased 3.4% from R865 164 in December 2012.

“The property market is gaining confidence and we expect property prices will continue to show positive nominal price growth for the year ahead,” says Rhys Dyer, ooba COO.

First time home buyer activity continues to drive the market, with over 51% of ooba’s applicants in January being first time home buyers. The average house price for first-time buyers was up 5.5% year on year to R686 452 and up 3.2% month on month to R665 167.

Despite the high number of first time homebuyers, the average home loan deposit dropped 4.5% year on year and 5.7% month on month to R133 805, representing 15% of the average purchase price.

The average initial bank decline ratio decreased 4.3% year on year to 46.0% in January and the percentage of applications that were declined by one bank but approved by another improved significantly by 5.0% to 25.5%.

“That means one in four applications would have been declined had they not been originated to more than one lender,” says Dyer.

ooba’s effective approval rate, which is the overall percentage of loans approved once ooba has originated the loan to multiple banks, was 65.7% in December, 5.7% up on January 2012, whilst ooba’s trailing approval rate, which takes into account loans approved after month-end, is currently 71.8%.

ooba currently obtains approval for 71% of all home loan applications it processes, which compares favourably with the average bank approval rate of 54% across the major lenders. “These stats show that homebuyers using ooba have on average a 32% better chance of securing home loan approval,” says Dyer.

ooba continues to report record approval rates on top of the record highs set in the last quarter of 2012. The value of home loans approved through ooba in January 2013 is up 44% on January 2012, while December and November 2012 were up 49% and 30% respectively on the prior year.

The market conditions are supported by the lower interest rate environment coupled with subdued property price inflation and improved lending policies, says Dyer. He expects the current environment to persist for 2013.

Full oobarometer analysis:

Indicator Jan 2013 Jan 2012 Change yr on yr (Jan 13 vs Jan 12) Dec 2012 Change month on month (Jan 13 to Dec 12)
Avg purchase price 894,510 850,589 5.2% 865,164 3.4%
Avg purchase price of first time buyer 686,452 650,574 5.5% 665,167 3.2%
Avg approved bond size 760,705 717,345 6.0% 727,874 4.5%
Avg deposit (as % of purchase price) 15.0%(R133,805) 15.7% (R133,244) -4.5% 15.9% (R137,290) -5.7%
Avg age of applicant 37 37 No Change 37 No Change
Avg initial decline ratio (first bank decline) 46.0% 50.3% -4.3% 46.0% 0.0%
Ratio of applications declined by one lender but approved by another 25.5% 20.5% 5.0% 23.2% 2.3%
Effective approval ratio 65.7% 60.0% 5.7% 64.7% 1.0%

 

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