Statistics from BetterBond, which represent 25% of all residential mortgage bonds being registered in the Deeds Office, indicate that almost half of all home loan applications are now being made by black buyers, compared with only about 12% a decade ago.
These figures show that black homebuyers have accounted for some between 45% and 48% of all bond applications in the past three months, compared with 43% in the same months of last year. In addition, black buyers, most of whom are also first-time buyers, now account for between 37% and 39% of home loan approvals monthly.
Cheaper to buy
"It is very encouraging to see such an increase in the number of black buyers coming into the market and achieving bond approval, especially in the light of the slowing economy and slow progress on job creation. It suggests a growing appreciation of the wealth creation potential of home ownership," says BetterBond CEO Rudi Botha.
"It is also a clear indication of the effect that the current shortage of good rental housing stock and rising monthly rentals are having on the market, in that more and more tenants are seriously considering that it might now be cheaper to buy than to rent and exploring the possibility of becoming homeowners in their own right. This trend is being further fuelled by the current low interest rates and by improving access to bond finance, especially for first-time buyers," Botha says.
Meanwhile the BetterBond figures also show that the overall number of home loan applications made in June was 5% up on the same month of 2011, following a 24% year-on-year increase in May. "This is a reflection of the fact that consumers generally are regaining confidence in the real estate market, while prices which are still at low levels are also boosting investment buying."
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