Bond approval rates climb, as applications hit '90% of pre-Covid annual target'
The property market is holding steady in challenging times, with the lower end of the market accounting for the bulk of home loan applications.
South Africa’s GDP contracted by 2% in the first quarter of 2020, during which lockdown had only just begun. However, the full impact of Lockdown will only be seen in the second quarter.
According to the most recent report by Stats SA, consumer spending remained positive in the first quarter, with households spending more on food and non-alcoholic beverages as well as on household furniture and equipment. The ‘Finance, real estate and business services’ sector was also one of the highest growing industries, increasing by 3.7% QoQ and contributing R667,396 million to the economy.
“Some economists are predicting a 48% contraction in the second quarter. This has already dramatically impacted negatively on consumer spending and will have a knock-on effect on employment in the coming months,” says Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa.
Under financial pressure? Consider these bond relief measures
With interest rates at record lows, South African homeowners have been given some relief on their bond repayments. However, many are still struggling to meet their monthly obligations thanks to the embattled economy, widespread pay cuts and ever-increasing unemployment.
But there are alternative options to get homeowners through a difficult time - especially if you consult with your lenders who are being extremely supportive of clients in financial difficulty right now.
Negotiate a fixed interest rate?
An option for homeowners struggling with monthly expenses is to consider fixing their home loan interest rate for a specific period of time. While Kondowe says fixed interest rates are always higher than the equivalent prime-linked rates, they are a useful option when predictability is the goal.
“A lot of homeowners may be tempted to fix their interest rates at our current record lows,” says National Admin Hub Manager for Rawson Finance, Leonard Kondowe.
My rental agent said 4 dogs allowed, now I have lost R25k
A Property24 Reader asks: I am renting a townhouse and the agent assured me there were four dogs allowed. However, she told the landlord that I only have two dogs. On three occasions after signing the lease, she assured me again that four dogs were fine. On one occasion, she verbally assured me in front of another agent that all was in order to have four dogs on the property. The agent subsequently resigned.
After I moved in, I collected the rules from the caretaker. This stipulated that only two pets were allowed. I was told by the agency that I have three months to move out.
While I have found another house and signed a lease, I incurred costs because of the move, adding extra security, etc. The total including my deposit amounts to R25 000 owing to me by the rental agent’s company. I had not even lived there for a month, causing me all sorts of aggravation, stress and additional costs.
ALA Alan Levy Attorneys replies: