Housing in Southern Africa February 2015

Housing

complete to see if they will qualify for a home loan. The www.fnb.mobi smart bond is a tool which can be used to go through the application process and then go shopping, rather than finding out that they do not qualifymid-way through the process. This way is more empowering.” Lee is passionate about consumer education, “As a finance institution we compete rather aggressively but one thing that we need to keep in mind is the need to educate our customers. Lack of information or sharing, will potentially jeopardise a consumer’s wellbeing. It is important that the consumer understands the entire process from mortgage originator to the role of the real estate agent etc. What ownership entails includes: basic maintenance, the National Home Builders Registration Council building requirements and codes for all additions, such as garages, addi- tional extensions, walls, free standing buildings etc. The implications of hav- ing a bond on the property. “As banking institutions we tend to focus on the happier side. There is however an unfortunate sad side when people fall into difficulties. They need to knowwhat options they have andwhat it couldmean for their overall financial wellness. Consumer education needs to happen on an ongoing basis. If we educate consum- ers, the market will benefit from it,” concludes Lee. When Lee talks about consumer education, he has a deep sense of commitment toward consumers, which is certainly not just platitudes or political correctness in a bid to gain market favour or share. ■

In terms of scorecards and the fact that the majority of South Africans have impaired credit records, we asked Lee have there been any im- provements in the approval rates? “We have found that two in ten con- sumers have impaired credit records as they have not recovered from bad judgements and theywill be declined outright. Whilst the majority, six out of ten consumers apply for prop-

costs are comparable with the top end of the market. This needs to be addressed as this cost has not been factored in for the Gap and affordable housing market.” Lee goes on to explain that we need to do thingsmore efficiently and with a lot less cost, in order to benefit this sector. On interest rates, general senti- ment anticipates between 1% and

1,5% interest rate hikes with- in the next two years. “It is im- portant to note that there are ways in which customers can mitigate the im- pact of interest rate increases. By choosing a fixed rate for

erties that are just too expen- sive for what they can afford at this point in time. Two out of ever y ten consumers still have impaired credit records but have held steady and not incurred more

‘The www.fnb.mobi smart bond is a tool which can be used to go through the application process and then go shopping, rather than finding out if they qualify mid-way through the process. This way is more empowering.’

debt.”

three to five years, will help consum- ers weather a current uncertain inter- est rate environment.”

FNB offers consumers

a tool that they can

February 2015