The BetterBond Property Brief
According to the January BetterBond Property Brief, we’re starting the new year on a positive foot. Despite a slight dip in the number of home loan applications during December, last year witnessed a turning point in the downward trend of home loan activity, with 6.6% year-over-year growth in the BetterBond home loan index—substantially higher than the current inflation rate of 2.9%.
The two successive 25 basis point declines in the prime lending rate towards the end of 2024 assisted a marginal rise in average home prices—during Q4 2024, average home prices increased by 1.2% QOQ for first-time and repeat buyers alike.
The month in numbers
- 6.6% YOY increase in the number of home loan applications
- 8.1% YOY increase in home loans granted for all buyers
- 4.5% YOY increase in the average home price for first-time buyers
- JHB South-East ranks number one for home loans granted
BetterBond index of home loan applications

Despite a slight dip in the number of home loan applications during December, last year witnessed a turning point in the downward trend of home loan activity, with YOY growth in the BetterBond home loan index of 6.6% – substantially higher than the current inflation rate of 2.9%.
The index trend since 2019 confirms the negligible negative effect of the Covid lockdowns, with a sharp recovery in home loan applications within merely one quarter. In contrast, the restrictive monetary policy that kicked in during 2022 took the wind out of the sails of the residential property market, with the Q4 home loan index still 28% shy of the reading in Q1 2022. With interest rates likely to continue declining during 2025, the prospects of a new, sustained growth phase in the housing market is on the cards.
Average home purchase price

Two successive declines of 25 basis points in the prime lending rate towards the end of 2024 assisted a marginal rise in average home prices during 2024 . During Q4 2024, average home prices increased by 1.2% QOQ for first-time buyers and repeat buyers alike. Compared to Q4 2024, the increases were 3.2% for all buyers and 4.5% for first-time buyers, both of which managed to beat inflation.
In real terms, house prices remain at a discount to those that existed before the relentless rise in interest rates that commenced at the end of 2021. Compared to Q4 2019 (pre-Covid), however, the average house price for all buyers has increased by 9.5% in real terms and by 38.4% in nominal terms – a clear sign of the investment potential in real estate. Any further lowering of interest rates will continue to squeeze the current buyers’ market.
Average deposit for home purchase

The lowering of the average deposits required for access to home loans that occurred in Q3 2024 was halted during Q4, with increases of 2.7% and 3.4%, respectively, for all buyers and for first-time buyers. Fortunately, the YOY declining trend in the average deposit requirement remains intact, with first-time buyers now having to raise 6% less to qualify for a home loan.
The lengthy presence of a rate-hiking cycle that took the prime rate to a 14-year high has predictably led to more caution among banks, with the current average deposit for all homebuyers 58% higher than three years ago. The slight uptick in average deposits at the end of last year is not surprising, as traditional year-end bonuses serve to boost the cash flow of many prospective homebuyers.
Regional composition of home loans granted – all buyers (12 months to Dec 2024)

During 2023, no region in the country escaped the negative impact of a combination of record-high interest rates and sharp increases in the deposits required for home loans, with double-digit YOY declines having been recorded for home loans granted.
Fortunately, the tide turned decisively during 2024, with an increase of 8.1% in the total number of home loans granted. In the process, a shake-up has occurred among the regional rankings.
The number two region, Johannesburg North West, has slipped to third position, swapping places with the Western Cape, while Johannesburg South East has consolidated its position at the top. The smaller regions of the Eastern Cape and North West are still battling to get back to 2022 levels, while the Free State & Northern Cape region recorded the highest YOY gain in loans granted, namely 36%.
Read the full report here