Banks anchor confidence in the home loan market

Jani le Roux

19 May 2025

MAIN IMAGE: Rhys Dyer, CEO of the ooba Group

ooba Home Loans

Despite ongoing shifts in the market, one constant remains: the unwavering support of South Africa’s major banks, driven by strong competition for new business across home loan lenders.

The latest data from ooba Home Loans shows that approval rates, high loan-to-value (LTV) ratios and competitive interest rates remain favourable across the country – but the real advantage for consumers lies in how they access these benefits.

“Our data shows that despite a tough economic climate, the banks continue to compete strongly for business, offering a range of attractive incentives, including favourable interest rates, discounts on bond registration fees, flexible repayment terms, and in some cases, home loans of up to 110% – all of which assist consumers in affording to buy property,” says Rhys Dyer, CEO of the ooba Group.

He adds that securing these kinds of deals is made possible by comparing offers from multiple lenders. “Shopping around for the best home loan is critical to unlocking the most competitive terms, and that process is made significantly easier by using a free home loan comparison service like ooba Home Loans, which gives buyers access to multiple banks through a single application. Without this kind of comparison process, a homebuyer might unknowingly settle for a less competitive offer.”

Healthy competition benefits homebuyers

Dyer unpacks some of the attractive bank offerings currently available to prospective homebuyers as follows:

– Competitive interest rates prevail: “When the banks know that they are competing against other banks for your business, they will do their best to compete by providing a competitive interest rate as a means to secure (and support) homebuyers,” explains Dyer, adding that the average interest rate for ooba Home Loan customers currently sits at prime less 0.65%, notably up on the average discount of prime less 0.56% recorded over the past 12-months.

– Repayment period flexibility: While home loans are usually paid over a recommended period of 20-years, Dyer adds that the banks have eased their lending terms to assist homebuyers who are on a tight budget. “We have seen an increase in the approval of 30-year home loan repayment terms for our customers, with 15% now choosing to repay their home loan over a 30-year term.”

– Discounts on bond registration fees welcomed: The country’s major lenders frequently provide up to 50% discount on attorney bond registration fees. “This discount is primarily available to first-time homebuyers and applies specifically to the fees charged by the bond registration attorneys for registering your bond at the Deeds Office, equating to thousands of rands in savings.”

– Zero-deposit home loans possible for some: The percentage of customers qualifying for 100% home loans has remained steady over the past few years at 83%. Similarly, 80% of applications from first- time homebuyers applying for a zero deposit loans have been successful.

“Homebuyers without a deposit can benefit from using a home loan comparison service to boost their chances of securing the highest possible home loan amount,” shares Dyer. “While there will always be a strong preference for home loans with a deposit, as it reduces risk and price, it’s encouraging to see more buyers gaining access to the market – especially in a year where interest rates are remain relatively high,” he adds, noting that some home loan approvals are now reaching up to 110%.

– It pays to go green: “There are financial incentives in place for eco-friendly properties, such as rebates and discounted fees, making sustainable homeownership more accessible.”

– Repeat business incentives: “In a bid to attract second-time buyers, we have seen some of the banks introducing further incentives when competing for additional home loans.”

Dyer concludes by emphasising that the ongoing commitment from South Africa’s banks -strengthened through strategic partnerships with home loan comparison services – like ooba Home Loans – continues to play a vital role in sustaining momentum within the property market and expanding access to homeownership. “We’re proud to work alongside the banks in turning the dream of homeownership into a tangible reality for so many South Africans”.