Samuel Seeff, the chairman of the Seeff Property Group has announced it’s ‘time to buy property’ as yesterday’s 25bps interest cut by the Reserve Bank brings welcomed relief for consumers and property buyers alike, Cape {town} Etc reports.
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The rate cut reduces the repo rate to 8% and as a result, the base home loan rate should decrease to 11.5%.
Seeff has further stated that although he is happy with the interest rate cut, he hopes that the reserve bank will follow in the footsteps of the US Fed, where rates were cut by 50bps and plans are in motion to introduce two further cuts of 25bps each.
The Bank of England and the European Central Bank has also recently introduced interest rate cuts.
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The Rand has further continued to strengthen against the dollar as it currently lays below R17.50 in comparison to the US dollar. This shows improvement in comparison to late April, where it stood as R19.2 to the US dollar.
Consumers should be further alleviated by the upcoming petrol price cut and falling oil price.
‘The scene is set for the economy and property market to grow but further interest rate relief is needed to allow for this’ says the property group.
The newfound prosperity is believed to be the result of the Government of National Unity as well as the stabilisation of the energy grid.
The interest rate cut, decrease in petrol price and lessened inflation will loosen room in the consumer’s budgets to spend in the economy and ultimately improve the affordability of homes.
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Seeff has further commented that this may potentially be one of the best markets for property buyers, as price growth has weakened over recent years.
Buyers are encouraged to take advantage of the current market.
More active buyers in the market are also beneficial for sellers as it more often than not results in an increase in offers.
A thriving property market is a catalyst for further infrastructure development and growth which includes the housing sector.
As a result of the 25bps rate cut, mortgage repayments will reduce as follows:
R750 000 bond – from R8 128 to R7 998 – thus saving R130
R900 000 bond – from R9 753 to R9 598 – thus saving R155
R1 000 000 bond – from R10 837 to R10 664 – thus saving R173
R1 500 000 bond – from R16 256 to R15 996 – thus saving R260
R2 000 000 bond – from R21 674 to R21 329 – thus saving R345
R2 500 000 bond – from R27 093 to R26 661 – thus saving R432
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Picture: Fani Mahuntsi / Gallo Images
