After the five aggressive repo rate cuts last year that dropped the prime lending rate to a historic low of 7%, homeowners and aspirant buyers have been holding their breath, waiting for the pendulum to swing the other way in 2021.

South African home buyers can look forward to a few more months of record-low interest rates as the Monetary Policy Committee has once again opted to hold the repo rate steady at 3.5%.

The South African Reserve Bank (SARB) is set to hold the repo rate at the 23-25 March meeting, according to a unanimous vote by 25 economists on Finder’s repo rate forecast report.  

Stonewood Village Homes Development Already Into Final Phase.

If the past year has taught us anything, it is how important our homes have become to us.

Despite the uncertainties surrounding the pandemic, the market for prime global residential property is expected to remain active as the long-term appeal of this sector holds strong - as sentiment improves amidst the rollout of the Covid-19 vaccine across the globe, and as the Biden administration plans a massive stimulus package to revive growth in the US, according to Savills World Cities Prime Residential Index.

While a further reduction to the interest rate would have been a bonus for aspirant first-time home buyers and existing homeowners with mortgages, the Monetary Policy Committee’s decision to leave the repo rate unchanged at 3.5% was anticipated by the majority of market commentators, says Dr Andrew Golding, chief executive of the Pam Golding Property group.

Thursday, 21 January 2021 16:25

Repo rate remains unchanged at 3.5%

The Monetary Policy Committee has decided to keep the repo rate unchanged at 3.5% per annum, Reserve Bank Governor, Lesetja Kganyago, has announced.

After the worst economic downturn in decades, further dampened by the recent tightening of lockdown restrictions in response to the second wave of the pandemic and the recommencement of load shedding, economic growth – while admittedly coming off a low base - is still widely expected to show some positive growth of around 3% this year.

After last month's bleak budget speech by Finance Minister Tito Mboweni, South Africans are settling in for a long and uncertain road to economic recovery. While the inevitable increase in pressure on consumers’ pockets will unavoidably filter down into the property market, experts remain cautiously optimistic about property’s performance.

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