Home loan applications increase

ooba, a South African bond originator, on Monday said it recorded a substantial increase in the number of home loan applications submitted during November 2011, as well as a significant rise in the value of approved bonds.

The company's latest statistics revealed that the number of bond applications during November 2011 increased by 36% from November 2010.

The statistics also showed that November was a record month for the value of approved home loans, which increased by 33% in comparison with November 2010.

According to Saul Geffen, CEO of ooba, the value of approved loans in November was the highest recorded since May 2008.

Geffen said that ooba recorded consistent month-on-month increases in home loan applications since the beginning of 2011 and expected this growth to continue into 2012.

The rise in applications and approved home loans was attributed to the consistent improvement in bank lending criteria throughout 2011, and the reduction in interest rates of 650 basis points since 2008, which improved affordability and reduced the cost of servicing a bond significantly.

"The record low interest rates, coupled with subdued property price inflation, increased bank approval rates and lower deposit requirements and increased bond sizes, will continue to positively influence the property market," Geffen commented.

He added that the company's increased market share, as well as organic growth from the improved property market and lending conditions had benefited the application growth.

The number of applications in November 2011 was 55% up on the lowest number of applications recorded in January 2009, however, the number of applications was still 51% off the peak of the market in May 2007.

The value of approved loans was up 216% from January 2009, which was the month that recorded the lowest value, however, the value of approved loans for November was only 29% of the peak in May 2007.

I-Net Bridge

Posted at 01:45PM Dec 21, 2011 by Editor in Home Loans  |  Comments[4]