Call for greater leniency in national credit act
http://www.iolproperty.co.za/roller/news/entry/call_for_greater_leniency_in
Another high profile personality in the Cape property sector has now said that until there is an easing of the National Credit Act criteria which the banks apply to their mortgage bond lending and a greater willingness to accept risk, there can be no hope of the property sector (or indeed the economy) once again flourishing.
Mark Marks, a director of the Western Cape Institute of Estate Agents and a consultant to Permanent Trust, says that right now both the residential and the commercial property sectors can offer good bargains to those buyers with cash. This, he said, reflects the difficult conditions being experienced – a large percentage of potential buyers are simply unable to get bonds and are forced to continue to be tenants, “which has never been the declared government policy”.
I don’t think the problem lies in the NCA as much as in the banks’ credit criteria. Because of bad debt the banks were very afraid of losing millions of rands again, and therefor their credit lending policies were adapted.
They have become a little more lenient lately, but they are still very carefull with home loan approvals.
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