First-time buyers gain ground as deposits ease nationally

First-time buyers are finding new opportunities in South Africa’s property market as lower deposit requirements, stronger incomes and resilient lending help offset higher borrowing costs.

BetterBond’s July 2026 Property Brief also points to improving economic conditions, with GDP growing by 1.4% year on year in the first quarter and a stronger rand supporting confidence in the housing market.

The report shows average deposit requirements for first-time buyers have dropped by 29%, from R230 000 in March 2024 to R163 000 in June 2026. Deposits for all buyers have also fallen 16% since April after briefly exceeding R300 000.

‘This is a welcome shift, especially for first-time buyers who may have affordability challenges,’ said BetterBond CEO Stephan Potgieter.  He added that the average purchase price for first-time buyers reached a record R1.4 million during the second quarter, while prices in this segment increased by 9% year on year. In real terms, house prices rose 4.5%, outperforming inflation.

Picture: Supplied

Although the recent prime rate increase softened home loan applications during the second quarter, demand remains resilient. Applications are still 5.7% higher than two years ago, while the number of home loans granted increased year on year.

The report also highlights stronger earning power among new buyers. Average first-time buyer salaries have increased by 15.5% in real terms over the past four years and now sit 64% above the average formal sector income.

Regional differences remain significant

• The Western Cape recorded annual house price growth of 13%, taking the average home price to R2.4 million, while first-time buyers paid an average of R1.9 million for a home.
• Gauteng continued to lead for first-time buyer home loans, with Johannesburg’s South-Eastern suburbs retaining the top position.
• Deposit requirements also eased in Pretoria, Johannesburg North West, Limpopo, the Eastern Cape, KwaZulu-Natal and Mpumalanga. The Northern Cape stood out as an exception, with first-time buyer deposits increasing 78% despite stronger bond approvals.

Economist Dr Roelof Botha said the broader economy is also creating a more supportive environment. ‘June provided an impressive array of good news on the economics front, most notably in the form of lower fuel prices.’

The July Property Brief says easing food inflation and lower fuel costs could reduce inflationary pressure and lessen the likelihood of further interest rate increases, helping to support affordability for aspiring homeowners.