The Monetary Policy Committee (MPC) announced today that interest rates will drop by 0.25%, bringing the repo rate to 7.25% and the prime lending rate to 10.75%. This comes amid persistently low inflation and muted economic growth.
Pleased with this outcome, Regional Director and CEO of RE/MAX of Southern Africa, Adrian Goslett, says this cut couldn’t have come at a better time for the real estate market and aspiring homeowners.
“With inflation at historic lows and household budgets still under pressure from slow economic growth, any easing in the interest rate environment is a meaningful win for consumers. Lower borrowing costs translate directly into more affordable monthly repayments, which can help unlock greater activity in the property market,” he notes.
While the residential property market has remained surprisingly resilient through a tough economic cycle, Goslett believes that this rate reduction will help reignite buyer confidence, especially among first-time buyers and the middle-income segment. “It also sends a signal that the Reserve Bank sees scope for supportive policy without compromising its inflation mandate, which should also boost investor confidence and provide room for greater economic growth,” Goslett highlights.
RE/MAX encourages both buyers and sellers to act strategically during this more favourable rate window. “For buyers, it may be a good time to explore opportunities while rates are still trending lower. For sellers, improved affordability could mean a larger pool of potential buyers, which could mean a quicker sale and more competitive offers,” says Goslett.
While global uncertainties remain, Goslett feels as though this rate cut signals a cautious step toward supporting domestic demand and restoring consumer confidence.
