The Monetary Policy Committee (MPC) announced today that interest rates will drop by 0.25%, bringing the repo rate to 7% and the prime lending rate to 10.5%.
REMAX Southern Africa views today’s announcement by the MPC as a welcome step towards reinvigorating economic activity and restoring consumer confidence.
“This cut is likely to serve as a much-needed catalyst for transaction volumes, particularly in the affordable and mid-market sectors. The market is still price-sensitive, but this rate cut could re-energize interest in property acquisitions,” says Regional Director and CEO of REMAX Southern Africa, Adrian Goslett.
“While this 0.25% cut may seem modest, it does mark a positive step toward restoring the rate environment we saw before the pandemic. Back in January 2020, the repo rate stood at around 6.5%, and although we’re still well above that, today’s decision brings us incrementally closer. It’s an encouraging signal that the Reserve Bank may be pivoting towards a more growth-friendly stance, which could help unlock pent-up demand in the housing market,” says Goslett.
Despite broader economic challenges, the housing market has retained a degree of buoyancy. House prices have strengthened and sales volumes continue to surpass expectations, especially within the REMAX SA network. REMAX Southern Africa reports that its registered sales figures have increased by 12.5% compared to last year (as at end June), and their total units sold increased by 6.5%.
“I remain optimistic about how this latest interest rate cut will impact the local housing market and expect to see activity strengthen further in the months to follow,” Goslett concludes.
