Young professionals are the driving force behind the affordable housing market in Benoni, says Marika Grové, Broker/Manager of RE/MAX Randgro, which services the greater Benoni area.
She notes that around 70% of recent buyers within the affordable housing space in the area (homes priced from R300,000 – R650,000) have been young professionals, of which around 60% are single. Young graduate investors are placing a priority on homeownership and are entering the market in their first or second year of work.
“The majority of buyers we are seeing within the affordable housing market are single working professionals aged between 30 and 35 years old. The other 30% of buyers within this market are around 45 years old and work within the public services such as teachers, nurses, police or employees within government sectors,” says Grové.
According to Grové, buyers within this sector prefer freestanding homes that offer space and a garden. “Many of the buyers who are purchasing within this sector of the market would prefer not stay within a sectional title property. This is because it does not offer them the same kind of value a freestanding home does in terms of the space and privacy,” says Grové.
She notes that location is just as important for them as for any other buyers, with proximity to hospitals, transport nodes, retail facilities and schools rated as the most significant. “Safety for their families, especially their children is also very important to these buyers. This is why closed estates that have security features such as a guard house and a secure perimeter with electric fencing are sought after.”
Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa, says that the affordable housing market across the country is set to continue growing over the next few years – both in terms of buyer demand and investment potential. “Currently more than 50% of the registered properties at the deeds office are valued at less than R500,000, and these kinds of properties can offer investors impressive yields. However, it is the fact that homes will be more accessible financially to those who need them that will have the most impact on the market,” he says.
Grové points out that with the rules around government subsidies through the Finance Linked Individual Subsidy Programme (FLISP) having changed, more South Africans will be able to make their dream of homeownership a reality. “Initially buyers who were looking at homes priced at R300,000 and less qualified for a FLISP assistance, however, the programme has now changed to assist any first-time homebuyers with a grant, provided they are South African citizens and earn between R3,500 and R15,000 per month,” says Grové.
She adds that this programme assists qualifying buyers to reduce the initial home loan amount or fill in the shortfall between their loan and the actual house price. This will open up so many more doors for buyers in the bonded affordable housing space.
“It is important for buyers to ensure that they have a good credit record and have money set aside for costs such as lawyer’s fees, banks fees and a deposit. When applying for a bond they will also be required to have three months bank statements, three months’ salary slips, ID, proof of current address and a marriage certificate if applicable. Ideally, buyers should obtain prequalification before they start their home search,” advises Grové.
In closing, Grové says that with demand for lower priced, quality homes vastly outweighing supply, the affordable housing market in Benoni will continue to grow from strength to strength.
This article “Young Professionals Drive Affordable Market” was issued by RE/MAX Southern Africa – http://www.remax.co.za/