Most South African household budgets are in for another squeeze, as consumers with home loans, vehicle financing and other forms of credit face more pressure on the back of the South African Reserve Bank’s latest interest rate hike. The central bank delivered its final monetary policy statement of the year on Thursday, hiking the repo rate by a widely expected 75 basis points to 7% – pushing it to above pre-pandemic levels.
How things have changed since January … The following table illustrates how repayments on different asset-backed credit have changed since the start of 2022 – prior to the interest rate hikes. A 20-year bond of R800 000 taken out at the prime interest rate now costs R1 664 more per month; the repayment on a bond of R1 250 000 is now R2 600 higher; and the holder of a bond of R3 million will pay R6 240 more each month.
Source: Loan Digest (loandigest.net)
Lending money is a lucrative business. That's it - nothing more to say.
Do you also have a view of Savings account? My understanding is that the interest on Savings accounts also increases. That view would also be wonderful to see.
When can we meet ? 😙
So unaffordable right now
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