[imagesource: Esa Alexander]
Yesterday, Tito Mboweni delivered the 2020 budget speech, and there was plenty to talk about.
If you want to see the national budget broken down in 18 graphs, pop in here.
Also, Mineral resources and energy minister Gwede Mantashe was shocked when he found out the price of spirits like gin and vodka was set to rise.
That’s the same Mantashe who fell for an April Fool’s prank and read out a fake mineral’s name at a Mining Down Under conference in Perth last year.
But hey, we digress, because we’re supposed to be talking about first-time homeowners and how the budget speech was good news for them.
For that, we go to Fin24:
Mboweni announced that transfer duty will no longer apply to properties that cost R1 million or less.
Previously the threshold was R900 000.
The change significantly reduces the financial burden on those looking to enter the market, says Carl Coetzee, CEO of BetterBond.
“It’s encouraging for the economy at large too, as property investment serves as an important barometer for the fiscal health of a country,” he adds.
Dr Andrew Golding, CE of the Pam Golding Property Group, agrees that some of the primary beneficiaries of Budget 2020 are first-time homeowners.
First-time buyers currently account for about half of all mortgages facilitated by ooba, and affordability has tended to dampen potential demand, explains Golding.
So this is good news for first-time homeowners who are in the market for something that comes in at under R1 million?
Won’t be coming near the City Bowl then, I take it.
Samuel Seeff, chair of the Seeff Property Group, says it isn’t quite as simple as that:
…the transfer duty change should not only boost the market for first time buyers, but also the low to mid-market sector of properties to about R1.8 million.
He says this is currently the most active segment of the market, supported further by a favourable mortgage granting climate.
“We see the current market as offering outstanding conditions for buyers. It is easier to obtain mortgage loans and the banks are granting higher bonds, especially for first time buyers,” says Seeff.
“There is now more stock to choose from and generally, sellers have become more negotiable.”
OK, that’s more like it.
According to Crispin Inglis, CEO of PropertyFox, “transfer duty change will give many an opportunity to get a foot in the property door, ramping up opportunities for first-time buyers, especially”.
There you have it, Millennials. Stop eating all that smashed avo on toast and start dabbling in the property market.
Thanks, Tito – just a pity about that R16,4 billion SAA bailout you also announced.
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