The South African Reserve Bank (SARB) has decided to maintain its repo rate at 7.0%, ensuring that the prime lending rate remains at 10.5%. This decision brings a reprieve to homeowners with variable-rate mortgages, sparing them from an increase in monthly payments.
With the prime rate held steady, the monthly repayment on a R2 million home loan over 20 years stays at R19,968. Had the bank opted for a 25-basis-point rise, borrowers would have faced an additional R335 in monthly expenses. Over the full term of the loan, homeowners will pay approximately R4.79 million, which includes both principal and interest.
The decision by the Monetary Policy Committee was not unanimous, with four members in favor of maintaining the current rate while two advocated for a 25-basis-point increase due to concerns over inflation. This split highlights the ongoing debate within the committee about how best to balance economic stability with inflationary pressures.
The SARB’s next announcement regarding interest rates is set for 23 September 2026, at which point further adjustments may be considered based on the economic landscape and inflationary trends.