The South African Reserve Bank's MPC decided to keep the repurchase rate at its current level of 8.25% per year. The decision was unanimous.
The announcement by the MPC that the repo rate would remain unchanged at 8.25% - meaning that the prime rate holds steady at 11.75% - was disappointing for consumers with significant borrowings, including those with existing mortgages as well as first-time home buyers, says Dr. Andrew Golding, chief executive of the Pam Golding Property group.
With inflation at a four-month high, rising to 5.6% in February from 5.3% in January 2024, this is the fifth consecutive MPC meeting where the repo rate has remained stable.
Dr. Golding says: “Although the resilience of the residential property market continues to shine through despite the current weak economy and financial pressures faced by consumers, with FNB and Pam Golding Properties’ own data reflecting that buying activity has trended higher in recent months, some respite in the form of a reduction in the interest rate would have gone a long way to bolster confidence and sentiment in the market.
“According to FNB’s estate agency survey, increased housing market activity saw time on the market improve from 11 weeks and four days in Q4 2023 to 10 weeks and six days in Q1 2024, led by the Western Cape, where time on the market fell to seven weeks and one day, while Gauteng also registered an improvement.
