{"id":1007,"date":"2016-08-10T07:32:05","date_gmt":"2016-08-10T07:32:05","guid":{"rendered":"https:\/\/propertyprofessional.co.za\/know-your-buyers\/"},"modified":"2023-05-12T13:50:24","modified_gmt":"2023-05-12T13:50:24","slug":"know-your-buyers","status":"publish","type":"post","link":"https:\/\/propertyprofessional.co.za\/2016\/08\/10\/know-your-buyers\/","title":{"rendered":"Know your buyers"},"content":{"rendered":"<h5><strong>To get the most out of your marketing spend and to be taken seriously as a knowledgeable professional, understanding your buyer profiles is a good place to start<\/strong><\/h5>\n<p>Chances are that you don\u2019t. That is because despite the size of South Africa\u2019s real estate sector, which generates about R236bn worth of property transfers a year, there isn\u2019t a definitive set of regularly updated statistics. This makes it tricky to work out who is buying what sort of real estate in various parts of the country, what they are paying and how much they are borrowing from banks to do so.<\/p>\n<p><img fetchpriority=\"high\" decoding=\"async\" class=\"wp-image-5249 alignright\" src=\"https:\/\/propertyprofessional.co.za\/wp-content\/uploads\/sites\/2\/2016\/08\/Property-Professional-magazine-Know-your-buyers-0.jpg\" alt=\"Property-Professional-magazine-Know-your-buyers-0\" width=\"395\" height=\"284\" \/>However, the kind of buyer profiling undertaken by the <strong><a href=\"http:\/\/www.realtor.org\/\" target=\"_blank\" rel=\"noopener\">National Association of Realtors<\/a><\/strong> (NAR) in the US has proved to be extremely useful for individual estate agents and agencies. It\u2019s also a good tool for other stakeholders in the sector, such as banks, originators, attorneys, developers and building contractors. It\u2019s with this in mind that we have started to build a picture of real estate consumption in South Africa\u2019s top three property sales regions (see the accompanying tables).<\/p>\n<h2><strong>WHAT WE KNOW<\/strong><\/h2>\n<p>These tables can tell you, for example, that Gauteng has a far bigger percentage of buyers (65.3% of home loan approvals) in the less than R1m price bracket compared with the Western Cape, where 53.8% of buyers fall into this category (see first table opposite). Looked at another way, the Western Cape has more upmarket buyers than Gauteng or KZN. There is further evidence in the second table, which shows that Western Cape buyers in all three age categories are purchasing higher-priced properties than their counterparts in the other two regions.<\/p>\n<p>The research shows that Western Cape buyers don\u2019t necessarily earn much more than those in the other provinces. This accords with recent research by data company <strong><a href=\"http:\/\/lightstoneproperty.co.za\/\" target=\"_blank\" rel=\"noopener\">Lightstone Property<\/a><\/strong>, which found that the monthly gross salary required by a buyer in the Western Cape is R22,600 \u2013 just R2,000 more a month than a buyer in Gauteng \u2013 on the purchase of a median-value property using a 20-year home loan at a 10.5% interest rate.<\/p>\n<p>But buyers in the Western Cape are paying much bigger deposits than those in Gauteng or KZN, which suggests that most are probably repeat buyers with cash in hand from the sale of an existing property.<\/p>\n<p>Gauteng has the largest percentage of buyers in the 18-35 age group (this usually includes the most first-time buyers) and the lowest average home purchase price in this category.<\/p>\n<p><img decoding=\"async\" class=\"aligncenter size-full wp-image-5250\" src=\"https:\/\/propertyprofessional.co.za\/wp-content\/uploads\/sites\/2\/2016\/08\/Property-Professional-magazine-Know-your-buyers-1.jpg\" alt=\"Property-Professional-magazine-Know-your-buyers-1\" width=\"750\" height=\"308\" \/><\/p>\n<h2><strong>DISTILLING THE STATS<\/strong><\/h2>\n<p>It\u2019s interesting to note that the averages we calculated for the first two age groups in each province stack up relatively well with the most recent Absa breakdown of prices for small and medium homes. But the averages for our 56-plus buyer groups are much lower than the <strong><a href=\"https:\/\/www.absa.co.za\/personal\/\" target=\"_blank\" rel=\"noopener\">Absa<\/a><\/strong> averages for large homes in all cases and regions. This tends to support increasing anecdotal evidence that a large percentage of 50-plus buyers are downsizing to reduce their expenditure on home maintenance and operating costs as well as home loan repayments.<\/p>\n<p>The stats on the breakdown of buyers (see above and below) suggests that joint purchases by couples or friends no longer account for the majority of home sales in all regions. Single men and women (never married, separated, divorced or widowed) are increasingly buying on their own. But, as noted in the recent <strong><a href=\"https:\/\/blog.fnb.co.za\/2016\/07\/fnb-property-barometer-residential-market-former-townships-price-index-july-2016\/\" target=\"_blank\" rel=\"noopener\">FNB Property Barometer<\/a><\/strong>, they are waiting much longer to become homeowners. The percentage of buyers who are less than 40 years old has declined to 44%, from a high of 53% shortly before the 2009 market crash.<\/p>\n<p><img decoding=\"async\" class=\"aligncenter size-full wp-image-5251\" src=\"https:\/\/propertyprofessional.co.za\/wp-content\/uploads\/sites\/2\/2016\/08\/Property-Professional-magazine-Know-your-buyers-2.jpg\" alt=\"Property-Professional-magazine-Know-your-buyers-2\" width=\"750\" height=\"308\" \/><\/p>\n<p><strong>Words<\/strong> Meg Wilson<\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>To get the most out of your marketing spend and to be taken seriously as a knowledgeable professional, understanding your buyer profiles is a good place to start Chances are that you don\u2019t. That is because despite the size of South Africa\u2019s real estate sector, which generates about R236bn worth of property transfers a year, [&hellip;]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[454,572,88,575,475,851,808,852,853,854],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v21.9 (Yoast SEO v22.6) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Know your buyers - Property Professional<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/propertyprofessional.co.za\/2016\/08\/10\/know-your-buyers\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Know your buyers\" \/>\n<meta property=\"og:description\" content=\"To get the most out of your marketing spend and to be taken seriously as a knowledgeable professional, understanding your buyer profiles is a good place to start Chances are that you don\u2019t. That is because despite the size of South Africa\u2019s real estate sector, which generates about R236bn worth of property transfers a year, [&hellip;]\" \/>\n<meta property=\"og:url\" content=\"https:\/\/propertyprofessional.co.za\/2016\/08\/10\/know-your-buyers\/\" \/>\n<meta property=\"og:site_name\" content=\"Property Professional\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/PropertyProfessional\" \/>\n<meta property=\"article:published_time\" content=\"2016-08-10T07:32:05+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2023-05-12T13:50:24+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/propertyprofessional.co.za\/wp-content\/uploads\/sites\/2\/2016\/08\/Property-Professional-magazine-Know-your-buyers-0.jpg\" \/>\n<meta name=\"author\" content=\"Keenan Prinsloo\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Keenan Prinsloo\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/propertyprofessional.co.za\/2016\/08\/10\/know-your-buyers\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/propertyprofessional.co.za\/2016\/08\/10\/know-your-buyers\/\"},\"author\":{\"name\":\"Keenan Prinsloo\",\"@id\":\"https:\/\/propertyprofessional.co.za\/#\/schema\/person\/22462ccece4a710f4b40653cf61024e4\"},\"headline\":\"Know your buyers\",\"datePublished\":\"2016-08-10T07:32:05+00:00\",\"dateModified\":\"2023-05-12T13:50:24+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/propertyprofessional.co.za\/2016\/08\/10\/know-your-buyers\/\"},\"wordCount\":602,\"commentCount\":0,\"publisher\":{\"@id\":\"https:\/\/propertyprofessional.co.za\/#organization\"},\"image\":{\"@id\":\"https:\/\/propertyprofessional.co.za\/2016\/08\/10\/know-your-buyers\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/propertyprofessional.co.za\/wp-content\/uploads\/sites\/2\/2016\/08\/Property-Professional-magazine-Know-your-buyers-0.jpg\",\"keywords\":[\"2016\",\"Absa\",\"buyers\",\"FNB\",\"FNB property barometer\",\"know your buyers\",\"Lightstone Property\",\"National Association of Realtors\",\"real estate statistics\",\"South Africa property market stats\"],\"articleSection\":[\"Marc Da Silva\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/propertyprofessional.co.za\/2016\/08\/10\/know-your-buyers\/#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/propertyprofessional.co.za\/2016\/08\/10\/know-your-buyers\/\",\"url\":\"https:\/\/propertyprofessional.co.za\/2016\/08\/10\/know-your-buyers\/\",\"name\":\"Know your buyers - 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