SEPTEMBER INTEREST RATE HIKE
The reserve bank has just announced a further 75 basis points increase in the interest rate (0.75%). This means that the repo rate is now 6.25%, which brings us back to pre-covid levels. The prime lending rate is now 9.75%.
Practically speaking this means on a bond of R2 000 000.00, the bond repayment used to be R17 994,52 over 20 years with the prime lending rate at 9%, whereas it will now be R18 970.34.
Even though this may add pressure on existing homeowners who have mortgage bonds, the positive side is that those consumers that have money invested will now also earn more interest.
22 Sep 2022
Author Miltons Matsemela Inc.
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