Nationally, the volume of first-time homebuyer applications dropped to 44.6% in February 2024, the lowest levels seen in seven years. File Picture: Tracey Adams
Relatively strong property price growth and homebuyer demand have helped the Western Cape hold on to its status as the darling of the residential property market, but data from ooba Home Loans reveals that several, often overlooked regions are poised to make an impact on the industry’s ongoing recovery.
Looking to regional outliers, ooba Home Loan’s data reveals that Mpumalanga and the Eastern Cape have registered double-digit property price growth in the first few months of 2024, while Gauteng South and East have managed to attract a large percentage of first-time homebuyers.
“Regional gains are cause for celebration, but our data shows that the underlying (six-month Moving Average) rebound of House Price Inflation (HPI) across the country for both repeat and first-time homebuyers has remained intact,” said ooba Home Loans CEO Gavin Lomberg.
“The overall average property price paid in February 2024 by ooba Home Loans customers stands at R1.47 million – a 2.3% year-on-year increase.”
Mpumalanga beats Western Cape in HPI and first-time homebuyer demand. Mpumalanga recorded the largest increase in the average price paid by ooba Home Loans customers January-February 2024, showing +17.6% year-on-year growth in the property price and taking the average price in the region to R1.27 million.
In comparison, property prices in the Western Cape grew by +10.4% in the same period.
“Mpumalanga remains one of the most affordable regions, beaten only by Gauteng South and East and the Free State,” said Lomberg.
“Affordability is a major attraction to the first-time homebuyer market segment.”
Nationally, the volume of first-time homebuyer applications dropped to 44.6% in February 2024, the lowest levels seen in seven years.
“Elevated interest rates, rising petrol prices and a sluggish economy have delayed many young buyers’ property ownership dreams.
“Even the Western Cape has not been immune to this downward trend, with first-time buyer applications a mere 36.8%, 14.3 percentage points lower than Mpumalanga and 25.9 percentage points lower than the Free State.”
First-time homebuyer demand is also elevated in Gauteng South and East. The region offers the second cheapest property prices in SA. Only the Free State offers better deals – with an average purchase price of R960 000.
The Western Cape remains the driving force behind a national uptick in demand for buy-to-let and investment properties, constituting 32.3% of applications processed by ooba Home Loans in February 2024, up from 30.1% in January. But the Eastern Cape is a strong contender.
Applications for investment/buy-to-let properties in the Eastern Cape have risen to an average of 16.6% of all applications processed by ooba Home Loans in January-February 2024, followed by Mpumalanga (11.4%) and Pretoria and North West (10.1%).