SARB Interest rate prediction for January 2025
"With inflation at the lower end of the Reserve Banks inflation target, South Africans can look forward to a further interest rate cut of .25% this week. This is expected to bring the cumulative decrease in interest rates to .75% since September 2024.
Should this take place, for South African consumers, the impact will be to further reduce the strain on disposable income by reducing the monthly repayments on all forms of debt including home loans, car repayments and credit card debt. Each cut in rates may be marginal but the overall impact starts to add up. On a million rand home loan, the cumulative decrease in payments if rates are cut this week by .25% will be R515.19 per month.
There is no doubt we have seen a shift in sentiment since the elections in May last year with the GNU, the elimination for the most part of loadshedding and lower inflation. The uptick in sentiment has been positive for the residential market with increasing buyer demand especially in areas like Gauteng which has experienced an oversupply and no price growth in recent years. It will take some time before the increase in demand translates into price growth, but further rate cuts will certainly add to the positive momentum in the market." , comments Herschel Jawitz, CEO of Jawitz Properties