THERE was a 3.1 percent increase year-on-year in the bank mortgage approval rate for the fourth quarter of 2021, according to statistics from mortgage originator ooba.
Competition among the major banks for a bigger share of the home loan market remained fierce in the fourth quarter of 2021. Banks continued to compete for business through strong interest rate discounts, while they simultaneously approved more bonds with lower deposit requirements, creating advantageous lending conditions for home loan applicants, ooba chief executive Rhys Dyer said yesterday.
“The average interest rate achieved for customers measured by the oobarometer was prime less 0.21 percent, 19 basis points lower than the fourth quarter’s rate of prime less 0.02 percent. Our statistics also show that second-time home buyers who, unlike first-time buyers, have access to a deposit are enjoying even more favourable rate discounts,” he said.
The oobarometer also showed a 1.6 percent improvement in the percentage of applications that were declined by one bank but approved by another.
In the fourth quarter, almost 50 percent of applications that were declined initially by one bank were subsequently approved by another bank, highlighting the value of using a home loan comparison service to shop around for the most advantageous home loan deal, said Dyer.
The oobarometer showed the average purchase price increasing by 3 percent year-on-year to end 2021 at R1 389 715.
BUSINESS REPORT ONLINE