select
|

Comment on interest rate announcement

Despite previous warnings from the Reserve Bank that the public could expect further rate hikes towards the end of the year, it was decided at this month’s Monetary Policy Committee meeting that the interest rate would remain at its current figure. The prime lending rate will stay at 9.5 and the repo rate will remain at 6%.

Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa, says that the decision to keep the rates where they are will be a relief to homeowners and consumers who are still coming to terms will the last rate hike and the rising cost of living. He notes that financial pressure from external sources such as higher food prices, higher electricity and water tariffs and a weaker Rand-Dollar exchange rate has had an impact on the property market over the last few months. Consumers are having to deal with their expenses increasing, while their income remains the same. This will make it harder for homeowners to hold onto their properties and for potential buyers to get a foot into the market.

Although the recent lower oil prices could moderate inflation to some degree, the weaker currency against the Dollar has caused inflation to edge closer to the upper end of the Reserve Banks’s target band of 6%. If this continues, we are likely to see rate hikes in the near future, be it in November or early next year. “Inflationary pressure will strengthen the Reserve Bank’s position to hike the rates. Homeowners and consumers need to prepare for future rate hikes by reducing household debt and increasing savings,” says Goslett. “While higher interest rates will impact potential buyer’s affordability ratios, the higher rates can also prove to be an advantage to those who are building up their savings for a deposit and other costs associated with a property purchase.”


  Comment on this Article

  Please login to post comments

Post to my facebook wall
  
2000
Characters remaining


    Latest Property News
    • 23 Nov 2017
      Reserve Bank Governor, Lesetja Kganyago, said that the Monetary Policy Committee had once again decided to let the interest rates remain unchanged with the repo rate at 6.75%, and the prime lending rate at 10.25%.
    • 23 Nov 2017
      As the holiday season approaches, most of us are counting the days until that year-end bonus hits our account. There’s nothing quite like a little bank balance booster to get us in the holiday spirit.
    • 23 Nov 2017
      The Adelphi Centre (now entitled “ARTEM") in Sea Point, Cape Town, is being extensively renovated, and once complete will offer an ultra-luxurious galleria style shopping centre unlike any other seen on the Atlantic Seaboard or in Cape Town.
    • 23 Nov 2017
      If you are looking to sell your home in today’s real estate market, there are certain things that you need to include both inside and outside your house. Today’s generation of home buyers is looking toward a more eco-friendly, energy and water conscious home, and if your house stands out then you are more likely to be able to sell it.
    • 22 Nov 2017
      Most people know of the Community Schemes Ombud Service (CSOS) and that levies must to paid to fund its operations. In this article the experts at Paddocks will address some of the issues that are causing confusion.
    • 22 Nov 2017
      While sales have noticeably slowed in most sectors in most Cape town suburbs, the security estate sector in Constantiaberg has bucked the trend by remaining buoyant, with sales by August this year already surpassing total sales in 2016.
    • 22 Nov 2017
      The end of the year is fast approaching, and so are all the travellers, tourists and holidaymakers. For those who live near or own a property in a holiday-hotspot, the festive season also brings with it an abundance of short-term rental opportunities. Its a great way for property owners to make a few extra rand for their own holidays or to put towards their savings.
    • 21 Nov 2017
      The buying process is over, and the moving truck has delivered your household goods to your new property. Now it’s time to unpack and turn your new house into a home.
        
    X
    Subscribe to the MyProperty Newsletter

    Name  
    Last Name  
    Email Address  
    Email Frequency
    select
    X
    Share this Page

       
    For Sale Property
    Rental Property
    More Options
    About
    Connect with us
    FEEDBACK