The South African Reserve Bank (SARB) has opted to maintain its repo rate at 7.0%, thereby keeping the prime lending rate steady at 10.5%. This decision provides a measure of relief to homeowners with variable-rate mortgages, as they will not face an increase in their monthly payments.
At the existing prime rate, a homeowner with a R2 million loan over a 20-year term would continue to pay R19,968 each month. By keeping the rates unchanged, borrowers have been spared an estimated R335 increase in monthly repayments that would have resulted from a 25-basis-point rise.
Over the duration of the 20-year loan, homeowners are expected to repay approximately R4.79 million, which includes both the principal loan amount and the interest charges incurred over time.
The decision by the Monetary Policy Committee was not unanimous, revealing a division among its members. Four members voted to keep the rates unchanged, while two advocated for a 25-basis-point increase due to concerns about inflation. The SARB has scheduled its next interest rate decision for 23 September 2026.