Durban - RE/MAX of Southern Africa said that debt holders should brace themselves as the company expected an interest rate hike later this month.
The Monetary Policy Committee (MPC) will meet again on July 20 and RE/MAX has forecast that a 25 basis points increase is on the cards.
Adrian Goslett, the regional director and CEO of RE/MAX of Southern Africa, said that the main purpose of these interest rate hikes was to bring inflation back within the Reserve Bank’s target range of between 3-5%.
“When you review the interest rate hikes alongside inflation statistics over time, you can see how each increase has had the desired effect of incrementally bringing inflation down.”
Goslett added that as soon as inflation hit the MPC’s target range, interest rates began to stabilise.
“Homeowners can take some solace in this because it indicates that, if we continue to follow historical trends, then an end to interest rate hikes is most likely in sight.”
Goslett said that, much like the economy, the property market worked in cycles.
“For every high much like we experienced post-Covid-19, there is a low to follow, as we’ve been experiencing over the last few months. This ebb and flow is completely natural and should not be cause for concern for homeowners and investors.”
Goslett added that the main priority now was for homeowners to find ways to stay on top of their debt repayments.
“Until interest rates begin to stabilise and hopefully decrease over time, homeowners will need to work carefully with their budgets to ensure that there are no late or missed payments. If the past is anything to go by, we are hopefully nearing a time of stabilisation that should bring some respite to homeowners.”
Goslett said that those who simply could not find the room in their budget for the next possible interest rate hike were advised to seek help from a professional financial advisor before the next interest rate announcement occurred.
“Being prepared will make all the difference when it comes to building greater financial freedom. Never be afraid to speak to the professionals and reach out for help when you need it.”