South Africa's Latest Interest Rate Hike
Category Property News
South Africa's Latest Interest Rate Hike
How will the interest rate hike affect your home loan repayments. Homeowners and consumers are in for more belt-tightening as the interest rate rises for the sixth successive time, with the Reserve Bank hiking the repo rate by another 75 basis points to 6.25%. The base home loan rate moves to 9.75%. This now effectively takes the interest rate back to the pre-pandemic level.
In terms of the impact of the hiking cycle on the property market, a two-paced market is emerging. While demand is still high on the one side, buyer hesitancy is increasing, with deals taking much longer on the other side.
The deteriorating buying conditions will likely push more people into the rental market. It's believed we will start seeing rental rates rise, which will be good for the rental market. Our Rental Team are ready to find you the perfect rental home, or assist you as the Landlord, find the perfect tenant. Contact our Rental Team here.
Raising interest rates is a tried and tested method of controlling outsized inflation. Click here for an article on how the Reserve Bank made its decision on 22 September 2022
Homeowners will definitely have to ensure they provide for increases in their current home loan repayment and Property Practitioners, have a duty to assist new home buyers plan and establish where their affordability is in terms of home loan repayments now and in the future.
Our Team of professional Property Practitioners are able to assist you not only find the perfect home, but talk you through affordability and ensure they are with you every step of the way.
Contact our Property Practitioners here
We have offices in Cape Town and Gauteng, and are able to assist you with all your property requirements.
Check your home loan affordability using the Mortgage Max online calculator. Our Bond Originator, Avia from Mortgage Max is also able to assist you determine affordability and discuss how she can assist you. Email Avia here.
Commercial Leases are affected due to the interest hike
While flexible work policies may assist businesses in reducing their overheads, this has a knock-on effect on landlords of commercial offices who may now struggle to reach full occupancy levels and guaranteed income in the long term.
Additionally, landlords are struggling to recover rentals from tenants who themselves are likely in a precarious financial position, unable to service their debt due to rising interest rates and inflation.
Our Commercial Team have the ability to manage your rental and lease process to ensure the prospective tenant can afford the lease, while they also price counsel the tenant, to include affordability, expectations and ensure all possible steps are taken to protect the landlord and tenant alike.
Contact our Commercial Team here
Author: Marketing
