Don’t wait any longer to buy or invest in Jo’burg

Today’s interest rate cuts underline the urgency with which buyers and investors should be purchasing properties in Johannesburg, says Denese Zaslansky, CEO of the FIRZT Realty group.

“Demand has already strengthened since rates started to come down in September last year, stock is drying up in popular areas and we have seen a 38% increase in sales and an average 6% price increase in the past six months,” she notes.

“And we expect to see even more momentum in this market following today’s decision to cut interest rates by a further 25 basis points. The cuts will take the home loan interest rate to 10,75%, its lowest level since February 2023, encourage further buying and underpin a steady rise in property prices.

“This means that there is no time to waste for prospective buyers and investors. At the current average home price of around R1,6m, for example, the gross monthly income required to qualify for a home loan is around R54 200, which is R3 600 less than it was at this time last year.

“But if prices rise by just 5% over the next 12 months, buyers will not only have to face a bigger monthly bond repayment, but will also need to earn about R2 700 more a month to qualify for their home loan – even if the interest rate stays the same. They will thus lose most of the advantage of the recent rate decreases.”     

Today’s rate drop was widely expected, given the fact that the inflation rate has been below the Reserve Bank’s target range of 3 to 6% for some months (2,8% in April) but that economic growth has remained stubbornly low.

“Of course, many households are feeling the benefits of lower food and oil prices, a stronger Rand and lower monthly repayments on home loans and other debts such as car finance, credit card balances and personal loans,” Zaslansky says.

“But global and local market turmoil has made consumers everywhere cautious about spending too freely. A reset is clearly needed, and the Reserve Bank has now followed the lead of many other central banks in lowering interest rates even further in order to boost confidence and hopefully encourage people to loosen their purse strings, buy more and stimulate employment as company fortunes improve.

“And we are confident that this is what will happen – and quickly - in an already rising property market in Johannesburg. One only has to look at the number of new developments taking place to see how rising demand is already spilling over into new construction and job creation that augurs well for the city’s property future.”

Issued by FIRZT Realty

For media inquiries contact

Denese Zaslansky on

082 560 1618

Or visit www.firzt.co.za

About FIRZT Realty 

Established in 2003, FIRZT Realty initially focused on residential real estate, but has since expanded to offer a broad range of services in both the residential and commercial property sectors, including sales, rentals, auctions and property management.