Annual House Prices Up

November 16 - The Chief Executive of ooba mortgage originator said that house prices in South Africa have surged for the fifth month in a row, showing that the market is definitely on the upswing.

The October oobarometer index showed that house prices have risen 9.9% on a year-on-year basis.

"This is the fifth consecutive month that the oobarometer has shown a rise in house prices and it is the biggest increase within that period," said Geffen.

First time buyers were particularly active in October, paying 10.7% more than they did for homes in the same month last year.

On a month on month basis, this was reflected as a rise of 3.7%.

Geffen said that the drop in South Africa's interest rates and the loosening of lending criteria of national banks definitely had a positive effect on the affordability of first time buyers.

Regarding home loan decline ratios, this has increased again at very small margin to nearly 50% compared to September.

Average deposits have also risen slightly, and Geffen believes that these will continue to fluctuate until the market stabilizes. August showed deposit demands of 23.1%, while October showed a drop to 15.6% (compared to September's 12.5%).

Ooba was confident that the South African property market would continue to improve over the next few months.

"The outlook for the property market is positive, with all important drivers such as increased application volumes, increased approvals, further relaxation of banking lending criteria and increased competitiveness amongst lenders indicating that the improvement in the market will be sustained," said Geffen.

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11/16/2009 10:00:20 AM