Those looking for positive data about the South African residential property market, says Rawson Properties Director Sean McCauley, should take note of what the latest FNB Property Barometer says about the rise in the number of first time homebuyers.
"Today," said McCauley, "they comprise 25 percent of the total. This is the highest level ever achieved for first time homebuyers for at least five years. In 2008, a boom time in property, only 15 percent of buyers were first timers. The growth, therefore, has been in the region of 66 percent."
The rise in this type of buyer, said McCauley, has probably contributed to the average house price moving upwards, albeit slowly. It has now reached the point where at R803 751 the national average house price has broken through the R800 000 barrier for the first time.
An increase in the number of loans being granted by the banks and the raising of the transfer duty tax exemption to homes sold for up to R600 000, said McCauley, had undoubtedly been a prime cause in the rise of first time buyers.
Also encouraging this market, he said, are the low interest rates (the lowest, in fact, in 35 years) and the simple fact that home prices, as regularly announced by the property media, are now very well priced.
"Our experience at Rawson Properties," said McCauley, "ties in with that reported by the National Association of Realtors in the USA. They recently let us know online that, to their surprise, owning a home in the US is still seen by the vast majority of Americans as a desirable and very important goal. Seventy two percent of US tenants paying rent surveyed by the association said that they still rate home ownership as one of their top economic priorities and the reasons given for this are much the same as they have always been. In other words, despite the US’s economic problems, Americans still see homes as their best chance of acquiring an appreciating asset. They also see homeownership as conferring status, as socially beneficial and likely to give their family increased stability.
In South Africa, said McCauley, the rise in first time homebuyers appears to be closely linked to the growth of the middle class.
"Rawson Properties’ experience", he said, "parallels that of the USA. We find that property is still seen by the middle class homeowners here in South Africa as the safest and most desirable asset class."