09/04/2023
Today’s second interest-rate decision of the year by the South African Reserve Bank Monetary Policy Committee has seen the prime interest rate rise by 0.5% to 11.25%.
There’s no denying that coming out of the period of sustained low interest rates brought on by the pandemic only to face one interest rate hike after another has been incredibly tough for homeowners already in the market, as well as those trying to establish themselves it in. This, together with the sharp increase in food and fuel prices since the outbreak of war in Ukraine in February last year, has put South African consumers under huge pressure financially.
And while MortgageMax CEO, Jors van Niekerk, is the first to acknowledge just how difficult the last year and a bit has been for homeowners as well as the property industry, he is hopeful that we are heading in the right direction interest rate-wise. “In spite of the fact that inflation remains well above the Reserve Bank’s target rate of 3%–6%, there’s still evidence to suggest that we are nearing the top of the current
rate hike cycle,” he says. “What’s more, there are strong indications that we can look forward to interest rates starting to stabilise and perhaps even beginning to come down as early as the end of this year.
And that is certainly good news for homeowners as well as those looking at getting a foot on the
property ladder.”More good news for aspiring first-time homeowners is that in spite of multiple rate hikes since November
2021, the lending environment has remained positive, with our banking partners continuing to help South Africans realise their dreams of homeownership by offering them excellent deals on their home loans.
“While interest rates are certainly an important consideration for those looking to buy property, they are not the only factor at play,” says van Niekerk. “Homeownership empowers South Africans to put down roots in their communities, build a legacy for their children and bolster their financial security. And these
benefits are priceless,” he concludes.
