What first-time homebuyers can get in Cape Town, Johannesburg and Durban

The national average purchase price among the first-time buyer segment was R1,136,625 in Q1 2023.

According to ooba Home Loan’s Q1 2023 oobarometer, the average purchase price for first-time buyers only increased by a mere 0.4% from Q1 2022.

For the overall national average purchase price, there was a 0.8% increase from R1,422,992 in Q4 2022 to R1,434,448 in Q1 2023

These sideways trends may concern owners looking to sell in the future, but Rhys Dyer, CEO of ooba Home Loans, said that this will probably be good news for those looking to enter the property market.

“Slowing house price inflation (HPI) means that properties are becoming more affordable, relative to household incomes,” Dyer said.

In addition, Free State, Mpumalanaga and Gauteng South & East overall recorded the nation’s lowest average purchase price, which is prompting activity amongst first-time homebuyers.

“Free State comes out on top for first-time homebuyer applications in Q1 2023 – sitting at 71.4%, followed by Mpumalanga at 59.4%.”

For the whole country, the Western Cape had the highest average purchase price of R1.81 million.

Activity robust in the higher end of the market

Despite the market favouring first-time buyers, buying activity remains strong in the middle and higher ends of the market.

Ooba said that 60% of finally granted bonds in Q1 2023 were in the price segment above R1.5 million, up from Q1 2022’s 58%.

However, properties in the price range above R750,000 to R1.5 million – where the average first-time buyer will likely buy –  dropped from 31% in Q1 2022 to 30% Q1 2023.

Properties below R750,000 also saw a year-on-year (YoY) decline of 1% – dropping from 11% in Q1 2022.

“Despite the accelerated pace of interest rate hiking since November ’21 there has been no significant shift yet towards the lower purchase price segments,” Dyer said.

Deposits higher among first-time buyers 

The average hone loan deposit currently stands at R107 268 for Q1 2023, marking an 11.9% YoY increase.

This means that the average deposit totals 7.5% of the total purchase price.

“Savvy homebuyers continue to prioritise deposits to help bring down their monthly repayments and secure the best interest rate in a tough economy.”

However, first-time buyers put down a larger average deposit of R109,793, which marks a 44% YoY increase and a 10.2% from Q4 2022.

This average deposit stands at 9.7% of the purchase price for a first-time homebuyer.

“We are pleased to see this market segment embracing deposits as a sign of smart financial planning,”  Dyer added.

Below are some properties that the national average purchase price among first time buyers can buy in Johannesburg, Durban and Cape Town.

• 2 bedroom apartment in Greenside, Johannesburg
• Price: R1,100,000 

• 2 bedroom apartment for sale in Glenwood, Durban 
• Price: R1,100,000 

• 1 bedroom apartment in Zonnebloem, Cape Town
• Price: R1,100,000

Read: Why you should buy property in your 20s: expert