{"id":818900,"date":"2025-04-06T10:00:00","date_gmt":"2025-04-06T08:00:00","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=818900"},"modified":"2025-04-04T16:42:53","modified_gmt":"2025-04-04T14:42:53","slug":"r110000-gift-for-people-who-buy-a-home-in-south-africa","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/property\/818900\/r110000-gift-for-people-who-buy-a-home-in-south-africa\/","title":{"rendered":"R110,000 gift for people who buy a home in South Africa"},"content":{"rendered":"\n

While the March National Budget created many pain points for South African households, it also gave homebuyers the ‘gift’ of increasing the transfer duty exemption threshold.<\/p>\n\n\n\n

In South Africa, elevated household debt and uncertain interest rate relief paint a challenging picture for South African households in 2025.<\/p>\n\n\n\n

These stresses were compounded following the tabling of the revised budget for 2025, which revealed plans to increase value-added tax (VAT) and no adjustments to personal income tax brackets, among other things.<\/p>\n\n\n\n

These measures further strain household income, with the freeze of tax brackets and VAT increase being the immediate cost pressures.<\/p>\n\n\n\n

The minister initially sought to hike VAT by two percentage points to 17% in 2025, but partners within the Government of National Unity rejected this plan.<\/p>\n\n\n\n

After careful consideration, the government has still opted to increase VAT, but now only by 0.5 percentage points in 2025, and a further 0.5 percentage points in 2026.<\/p>\n\n\n\n

The VAT hike is expected to raise R13.5 billion in 2025, much less than the R60 billion it sought to raise through its initial proposal of a two-percentage-point increase.<\/p>\n\n\n\n

The decision not to adjust tax brackets is expected to raise R28 billion in additional revenue in 2025\/26 and R14.5 billion in 2026\/27.<\/p>\n\n\n\n

However, the freeze on tax brackets means taxpayers fall prey to bracket creep, which could lead to individuals effectively paying higher personal income taxes as they move into higher brackets.<\/p>\n\n\n\n

Despite these bits of bad news for South Africans, the budget revealed some good news for homebuyers, especially those looking to buy a home for the first time.<\/p>\n\n\n\n

This follows the upward adjustment of the transfer duty tables by 10% or R110,000 in this year\u2019s Budget 2025, which increased the exemption threshold for transfer duty from R1.1 million to R1.21 million.<\/strong><\/p>\n\n\n\n

Transfer Duty is a tax levied on the value of any property acquired by any person through a transaction or in any other way.<\/p>\n\n\n\n

Good news for first-time buyers <\/h2>\n\n\n
\n
\"\"<\/a>
Samuel Seeff, chairman of the Seeff Group.<\/em><\/figcaption><\/figure><\/div>\n\n\n

Samuel Seeff, chairman of the Seeff Group, said this, in addition to interest rate savings following the recent rate cuts, will provide further savings for first-time buyers.<\/p>\n\n\n\n

“It has improved affordability, especially given that the average price for first-time homebuyers is around R1.264 million, according to mortgage originators ooba,” said Seeff. <\/p>\n\n\n\n

Lightstone data shows that first-time buyers tend to purchase in the R700,000 to R1.5 million price range. <\/p>\n\n\n\n

Almost half of all home loan applications in the last quarter of last year were from first-time homebuyers, with buying levels growing by about 9% during the latter half of last year compared to the first half.<\/p>\n\n\n\n

Affordability issues for first-time buyers are evident in the deeds office data, which shows that these buyers are now older than they were a decade ago.<\/p>\n\n\n\n

However, Seeff noted that most of the bigger metros have experienced good levels of younger buyers under 35, who make up around one-third in many areas.<\/p>\n\n\n\n

“The highest levels of younger buyers are in the Greater Joburg area, with the East Rand (50%) leading, followed by Johannesburg (29%), Pretoria\/Tshwane (29%), and Soweto (27%),” said Seeff. <\/p>\n\n\n\n

“The other metros also include good levels, such as Bloemfontein (28%) and Gqeberha (28%), with Durban (26%) and Cape Town (26%) at slightly lower levels.”<\/p>\n\n\n\n

Seeff further noted that the continued favourable mortgage lending is another upside for first-time buyers. <\/p>\n\n\n\n

“Ooba, for example, recently noted that first-time buyers accounted for 46% of home loan applications,” he said.<\/p>\n\n\n\n

“These buyers are often still able to secure loans of up to 100% of the property’s value, with some banks still offering costs on top of that.” <\/p>\n\n\n\n

While first-time buyers’ most dominant price range is between R700,000 and R1.5 million, Lightstone data shows that about 80% of purchases are below R1.2 million, with only about 7.5% over R1.5 million. <\/p>\n\n\n\n

Johannesburg and Durban metro areas tend to be more affordable for first-time buyers than the Cape Town metro area.<\/p>\n\n\n\n

The relatively flat price growth over the last two years means that first-time buyers can still find good value in the market.<\/p>\n\n\n\n

“And with the reduced interest rate and no transfer duty below R1.2 million, the market is more favourable for first-time buyers compared to a year ago,” added Seeff. <\/p>\n\n\n\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

The National Budget posed challenges for South African households but also benefited homebuyers by raising the transfer duty exemption threshold.<\/p>\n","protected":false},"author":92,"featured_media":782345,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12755],"tags":[3796,11693,853],"class_list":["post-818900","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-property","tag-national-treasury","tag-seeff-property-group","tag-south-africa"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/818900","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/92"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=818900"}],"version-history":[{"count":6,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/818900\/revisions"}],"predecessor-version":[{"id":819817,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/818900\/revisions\/819817"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/782345"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=818900"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=818900"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=818900"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}