First-time buyers now account for 72.71% of home loan applications—up from 71.34% a year ago—reflecting rising confidence among new market entrants, according to MyProperty Home Loans.
Comparing data from March 2024 to March 2025, the report highlights several key developments in South Africa’s property market, despite ongoing financial pressures.
Notably, the increase in the transfer duty exemption threshold, reduced interest rates, and zero transfer duty on properties under R1.2 million have created a more favourable environment for first-time buyers.
The average purchase price for first-time buyers rose from R1,188,663 to R1,215,522, while the average bond size increased substantially – from R1,029,192 to R1,567,694.
However, deposits also climbed sharply across buyer groups, with the average rising from R159,471 to R352,173, reflecting broader shifts in the market.
First-time buyers are entering the market later, with the average age now at 39 – likely due to prolonged financial strain or changing life priorities.
Meanwhile, the prime lending rate fell from 11.75% to 11%, easing repayment burdens.
Bank bond approval rates improved slightly (from 52.24% to 52.61%), suggesting a more borrower-friendly climate.
Ooba Home Loans reports an 18% rise in home loan applications in Q1 2025, with the value of bonds granted up 22.3%. Increased competition among lenders also led to larger bond approvals – up 2.5% for repeat buyers and 6.5% for first-timers.
National house prices continued their modest recovery, rising 2.2% year-on-year to R1,661,519. First-time buyer prices grew faster, up 4.5% to R1,247,810.
Regional trends saw Tshwane leading annual growth at 10.5% (to R1.79 million), followed by the Free State (8.8%) and the Western Cape, which maintained the highest average price at R2.33 million.
Ooba CEO Rhys Dyer noted increased activity in the high-end market, with properties over R3 million now making up 28% of bond volumes – a trend linked to semigration and older, affluent buyers.
While deposits have generally risen, they’ve declined for first-time buyers. The average now sits at R120,366 (9.6% of the purchase price), down 15% year-on-year.
“Last year, first-time homebuyers placed greater emphasis on saving for deposits. That priority appears to have shifted,” said Dyer.
First-time buyers now make up 46.5% of all Q1 applications, buoyed by six months of rate cuts and stability. Mpumalanga saw the highest share of first-time buyer activity (58%), followed by the Free State (55.9%), KwaZulu-Natal (52.4%), and Gauteng South & East (51.2%).
“Banks continue to compete for home loans market share by offering attractive discounts in the prime lending rate,” said Dyer.
Banks also eased access by offering zero-deposit loans with flexible terms, pushing national bond approval rates to 83.1%. The Western Cape (85.7%) and Johannesburg (85%) led the way.
Additionally, 43.2% of declined applications were approved by another lender, reinforcing the value of comparing options.
Investment property demand remains strong, rising to 12.9% of Q1 applications. The Western Cape leads (32%), while the Eastern Cape saw a dip (from 15.7% to 12.9%).
With softer interest rates, higher salaries, and a 10% hike in the transfer duty exemption threshold (saving buyers up to R3,300), first-time buyers are taking confident steps into homeownership.
Many are opting for smaller, more affordable starter homes. Starter homes – typically one- or two-bedroom units from 70m² to 116m² – require a lower upfront investment, are cost-effective to maintain, and meet essential lifestyle needs,
