Bond originator ooba recorded significant growth in bond applications and approved home loans in March.
The company’s latest statistics revealed that the Rand value of ooba’s home loan approvals showed year-on-year growth of 49 percent for March.
CEO of ooba, Saul Geffen, says that this is the company’s best performance since April 2008, but is still only 34 percent of the value of the approvals ooba recorded in May 2007.
He attributes these increases to increased buyer activity and easier access to finance, as well as ooba’s increased market share.
In addition to this, the South African economy seems to slowly be improving.
“South Africa's economy grew at a rate of 3.2 percent in the fourth quarter of 2011, up from 1.7 percent in the previous quarter."
In addition, we have recently seen an improvement in the job market, which will also impact the residential property market.
“According to the Adcorp Employment Index released, approximately 108 000 jobs were created in March 2012, up from 24 000 in February 2012. This is also higher than the 80 000 jobs created in January 2012 and is the strongest growth witnessed since the 2009 recession. Job creation and security play a big role in whether consumers are able to afford to apply for home loans.”
Geffen says that he also attributes these increases to the value proposition that bond originators offer consumers in the current lending environment.
“Consumers understand that in today’s tough lending environment, using a mortgage originator to apply to multiple lenders significantly enhances the chances of securing a home loan approval. There has been a continuous increase in the number of homebuyers making use of mortgage originators, given originators’ strong value proposition of securing approvals and on competitive terms.”