03 Dec 2012
Year-on-year (y/y) growth in the value of outstanding credit balances in the South African household sector was 9.3 percent in the first 10 months of 2012, up from 9.1 percent as at the end of September.
This is according to the Absa Home Loans Mortgage Advance report.
Writing in the report, Absa Home Loans property analyst Jacques du Toit says with growth in household mortgage balances remaining subdued, the components of household instalment sales and unsecured credit continued to drive growth in total household credit balances.
Growth in installment sales balances (15.1 percent share in total household credit balances) was 19.5 percent y/y at the end of October, with growth in unsecured credit balances (21.6 share) at 26.9 percent y/y over the same period.
He says private sector mortgage balances, comprising both commercial and residential mortgage loans, showed growth of 1.9 percent y/y up to the end of October.
The value of outstanding household mortgage balances increased by 3 percent y/y to R792.1 billion in the first 10 months of 2012, according to the report.
Du Toit says the share of outstanding household mortgage balances in total household credit balances continued to decline, reaching a level of 62.6 percent at the end of October.
He says the forecast is for y/y growth in mortgage balances to remain in single digits up to the end of 2012 and in 2013, based on trends in and the outlook for the economy, household finances and consumer confidence.
Interest rates are set to remain low over the next 12 months and consumer price inflation will stay within the inflation target range of 3 to 6 percent, despite some upward pressure in the short term, he adds. – Denise Mhlanga
Denise MhlangaProperty journalist at property24.com
If you are using Internet Explorer 8 or higher, please verify that your Internet Explorer compatibility view settings are not enabled.
For the best browsing experience, update to the latest Version of Internet Explorer or try out Google Chrome or Mozilla Firefox.
Please contact our Property24 Support Team for further assistance. Tel. +27 (0)861 111 724