you would remember when the president opened Parliament as the beginning of as as the 7th Administration started he placed one of the priorities in terms of affordable housing therefore mandating us as the department to pay attention and drive this area aggressively in this briefing we'll present our analysis of the information submitted to the office of the Disclosure by the financial institutions and what it choose about the affordability or housing for The Gap Market we will also highlighted the work that we are doing in terms of collaboration between various stakeholders as part of the interventions just to explain because many people will not know home loan and mortgage disclosure act which you call lamda was promulgated in 200000 and the ACT intends to compel financial institutions to disclose information about The Lending activities um and practices in the home loan market so everybody who's trying to buy a house house and they are applying for a a home loan Banks currently needs to be able to disclose to us who they've given the bonds to and the categories and the amounts that they have provided the off the information is disclosed to the office of disclosure through a Secretariat which is within the department of human settlement the information submitted of to the office of disclosure is mortgages pension based lending unsecured lending for Home Loans use H home loans and use purpose only in the past it had only been possible to asset the number of Home Loans granted by financial institutions but not those home loans application which have been declined and the reasons why this trend highlights the performance of financial institutions and help us to establish the home loan lending pattern and practices of financial institutions within the reporting period but also to understand in terms of South Africans how many remain without access to Opportunities of housing when you look at the slide here it shows you that between 2018 and 2022 around 6 million mortgages and home loan applications were received by the Banks and process out of this and out of the 6 million total of that have been approved actually that have been received 2 million comes from what we call previously advantaged persons with just over million approvals applications from historically disadvantaged persons during this period was 4 million applications uh sorry now hey this presentations okay um it's 2. 4 million approvals out of those 4 million so you can see just below so this are previously disadvantaged communities the rejection rate of home loans application has also remained High averaging around 68% these are people who are trying to get a house they apply they rejected in South Africa so they are earning a salary they are willing to have a house they are willing to have a bond they're willing to pay for it but it's not easy for them to get it and that's the message today and what we are trying to communicate however we remain concerned so this about almost around 3 million that we talking about and just to elaborate Our concern here is the people who actually went and applied so there will be those people who go online use online apps put an application and then it rejects they never go or they test their affordability in terms of affordability on app and then when it tells them that you don't afford then they just don't apply anymore there are those who walk into a branch ask for information to some looking for a house and therefore they tell them how much do you earn they show their pay sleep and once they show their pay Sleep they are told no no no you can't have a home loan they don't apply so we believe that there's more in terms of South Africa and Beyond the 3 million that are trying to have access to a house and they're not able to get it and then other reasons that and when we interact through the office of disclosure with financial institution as they disclose why are people being declined reasons are including bet credit record lack of affordability now we'll show you in terms of the slides and the graphs of what we are seeing so mortgage approvals for lower medium uh income BS this is between zero but many of them who are actually 3. 5 so remember in terms of the BNG you apply below 3,500 you'll qualify if you are any above then you need to go and apply for a a home loan now when you look at the graph the office of disclosure analysis for the past 5 years shows a concerning trend of affordability of housing for The Gap the decline in approvals in the Gap Market is quite significant so when you look between 2023 and 2024 you see a sharp decline in terms of people who are being approved in the market H in terms of being able to have a say shelter above their head which is secured which is what is decent this indicates the access to mortgage financing for The Gap maret is becoming increasingly difficult in the country now when you look at the next slide let me see the graph there now this ones hdp historically disadvantaged persons the total number of applications over 5 years are about 4 million valued at 2 trillion rent the number has been on an increase over the years although it slowed down in 2020 because of covid so the trend there you'll see it does speak to what we see in terms of our middle class in the country that You' have seen number number of people increasing but despite the increase there you still see quite a number of previously disadvantaged individuals being not able to access a house now when we look at the slide okay let me go back I just moved quickly when you look at the slide the approval versus the declining applications so when you look at that slide the rate becomes declining the approvals becomes the blue one that you see there now just in 2022 you'd see that the declining would be at the value what we can call at the value of 241 billion um and also the approvals there sitting the total number of approved application over 5 years is 49% of the total value at 1 trillion compared decline which is valued at 636 billion so approximately half of the applications are declined which is an indication the number of people who can Access housing is still higher so these are people who do not qualify for housing that's why you'd find them in informal settlements you'll find them in delipidated buildings in inner cities you'll find them in the backyards because they can afford they have an income that they have in their hands but they are not able to access mortgages now we look at the previously advantaged individuals versus the historically disadvantaged individuals now the number of hdps which is your historically disadvantaged individuals application is twice as high as that compared to White for for example a black person working into a a a bank versus their counterpart which is or similar white people walking into so we have twice higher with black people or previously disadv colored and Indian communities however the approval rate of the previously advantaged IND idual will be sitting at 53% while despite the fact that we are many who of those who are previously disadvantaged the approval rate is lower that's another story that we are tracing and we are following to understand in detail and some people would hear that sometimes it's because there's huge demand from the banks in terms of previously disadvantaged individuals either shity and all those things in terms of when they want to get mortgages but we'll get into that in addition the average mortgage loan approved pay historically disadvantaged individuals was around 527,000 compared to a previously disadvantaged individual which will get an approval rate or an approval of amount 2.
5 million so in terms of even inequality in terms of that wealth and that's what is worrying us because we are saying we are dealing with triple challenges in the country that of poverty inequality and unemployment so when we look at this rate and what we are seeing here it perpetuates an continues to increase in terms of our inequality in South Africa so that's that's that's that's just to show in terms of the trends between 2018 2019 2022 2021 and 2022 so the trends that we are seeing and we're monitoring in terms of a 5year period now we're comparing again being in the month of women still in August looking at whether we do have access to shelter for women and are they getting the application here we can safely say a higher number of applications of 1. 3 million are from women and are approved compared to 1.
