Durban - Reserve Bank governor Lesetja Kganyago announced at a media briefing in Pretoria on Thursday afternoon that the bank would keep the repo rate unchanged at 6.5%.
Dr Andrew Golding, chief executive of the Pam Golding Property group said it was great news for home-owners, especially first-time buyers.
"With the rand regaining some ground and inflation surprising on the downside this week, existing and aspirant home buyers will be relieved at the Monetary Policy Committee’s decision today not to increase the repo rate. However, although the committee did not raise interest rates, persistent rand weakness this year, rising inflation expectations and repeated petrol price hikes suggest that the first hike of the new interest rate cycle may occur in late 2018 rather than in 2019.
“In a property market largely sentiment-driven, we’ve recently seen evidence of recovery in demand gathering momentum, particularly among first-time home buyers, who will be further encouraged by the steady and relatively low interest rate.”
Golding says this sector of the market is demonstrating increasing appetite and activity, as noted in a recent report by ooba which highlights that in August, over half (51%) of all their mortgages were extended to first-time buyers, transacting at an average price of R953 644 – a figure which is rising steadily. This is compared with a median price of R1 188 492 for all ooba-approved mortgages during the same period.
“Further good news for home buyers is that ooba’s statistics for August reveal that the average deposit required by banks was slightly reduced, at 12.5% of the total purchase price," he said.The Independent on Saturday