Monday, October 5, 2009

Stronger rand and relaxed lending criteria to strengthen property market

“Relaxed lending criteria and a stronger rand should assist the ailing South African property market in making a turn for the better,” said eLan Property Group CEO Mark Taylor. Taylor’s comment surfaced following debate on whether or not the Reserve Bank will cut the interest rate again.

After seemingly closing shop on high loan to value mortgages over the past few months, the banks are casting the net wider and opening up origination channels for their clients. Standard Bank will now be offering clients up to 100% on deals less than R1, 5million. First National Bank is offering clients up to 95% on deals less than R1, 5million and ABSA is doing up to 90% loans on deals less than R1, 5million.

Taylor said, “This should motivate the mid-level buyer and investor to enter the market once more. We are already seeing increased market activity compared to the same quarter last year especially in the Ballito area.”

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