Standard Bank has observed a resurgence in first-time homebuyer activity in South Africa, despite record-high interest rates. In May 2024, nearly 50% of the bank’s registered home loans were taken out by first-time buyers, reflecting an increase in applications from these buyers in April and May. This resurgence follows a decline at the end of 2023 into early 2024, with ooba Home Loans’ oobarometer indicating a drop to 46% in first-time buyer applications in the first quarter.

Toni Anderson, Head of Standard Bank Home Services, expressed optimism about the growing proportion of first-time buyers, highlighting the bank’s commitment to supporting aspirant homeowners. Standard Bank’s offering includes home loans exceeding 100% of the purchase price to help cover upfront costs. Data shows that 48% of bond registrations over the past five years involved first-time buyers, with the bank approving 50% of their applications on average. The average loan value for first-time buyers was R975,000, and 40% of these buyers had a deposit, averaging 24% of the selling price. The top provinces for first-time buyer activity are Gauteng, Western Cape, and KwaZulu-Natal.

Lightstone data indicates a 13% decline in home purchases over the past five years, with a significant drop in purchases by individuals aged 26 to 35. Home sales to this demographic decreased by 25%, making up 27% of total property purchases in 2023. Interest-rate sensitivity and the anticipation of rate cuts in late 2024 contribute to this decline. Additionally, the average age of first-time homebuyers has risen to 36. Despite the overall decline, younger buyers are using property as a wealth-building strategy, with a notable presence in traditional township property markets where transactions typically occur around the R750,000 price point.