This is further confirmation in the trend of improving nominal house prices recorded by ooba in recent months.
"ooba has recorded steady albeit single-digit nominal house price growth since the beginning of the year," says Saul Geffen, ooba CEO.
"At the same time, there is an increased percentage of first-time buyers, which has remained a high proportion of total buyers since May 2011."
Of all ooba’s applications in April, 52 percent were from first-time buyers, up 1.1 percent year on year, and 0.2 percent month on month. The first-time buyers' average house price is showing a slight increase year on year of 0.1 percent to R677,712.
ooba also set a new company record in April. The overall value of home loan applications received and processed by ooba in April was 50 percent higher year-on-year, while the value of approved home loans was 30.5 percent higher year on year, resulting in ooba’s best performance in five years.
Geffen attributes this considerable growth to ooba having doubled its market share, as well as to increases in the number of applications received, higher property prices, lower deposit requirements and increased home loan approval rates.
For the past six-month period, ooba’s approved home loans value was up 28.5 percent compared to the same period the prior year. The value of approved home loans in April was 317 percent higher than January 2009, ooba’s lowest month during the property and financial crisis.
"A number of positive changes have conspired simultaneously to drive ooba’s volumes significantly higher," says Geffen.
"There also seems to also be a strengthening in the property market, with the increased confidence filtering into increased volumes."
ooba’s average approved bond size, at R761,259, is showing an increase year on year of 3.8 percent. The average bond size for first time home buyers is R601,040, and has increased by 5.4 percent since December 2012.
The average deposit in April was at 16.2 percent of the average house price.
"We advise applicants to save for a deposit, as these loans achieve higher approval rates and better terms", says Geffen.
The initial bank decline ratio of 46.0 percent is 0.9 percent higher year on year, but slightly lower month on month by 0.5 percent, and the ratio of applications declined by one lender and then granted by another is showing a slight year-on-year and month-on-month decrease of 1.8 percent and 3 percent respectively to 24.9 percent.
ooba’s effective approval rate, which is the overall percentage of loans approved once ooba has shopped the loan to multiple banks, was 65.5 percent in May. ooba’s trailing effective approval rate, which takes into account loans approved after month-end is running at 72.5 percent.
"ooba continues to achieve the highest approval rates in the industry. We secure approvals for 72 percent of all the home loan applications we receive, which compares very favourably with the overall average bank approval rate of 54 percent across the major lenders," says Geffen.
"This essentially means that homebuyers have on average a 34 percent better chance of getting their home loan approved when using ooba."
Source: Iafrica
