The South African Reserve Bank (SARB) has opted to maintain its repo rate at 7.0%, consequently keeping the prime lending rate steady at 10.5%. This decision provides some financial respite for homeowners with variable-rate mortgages, as they will not experience an increase in their monthly payments.
For a R2 million home loan with a 20-year term, the current prime rate translates to a monthly repayment of R19,968. By holding the interest rates steady, borrowers have avoided an estimated additional cost of R335 per month, which would have been incurred had there been a 25-basis-point increase.
Over the span of the 20-year loan, homeowners are projected to repay approximately R4.79 million, covering both the principal loan amount and the interest accrued over the years. This financial relief comes as a welcome decision for many, given the potential burden of increased costs.
The Monetary Policy Committee’s decision was not unanimous, reflecting a divided stance on the matter. Four members voted in favor of keeping the rates unchanged, while two advocated for a 25-basis-point increase, citing concerns over inflation as a pressing issue. The committee is set to reconvene for its next interest rate decision on 23 September 2026.