Is the latest interest rate decision a win for property owners?
The South African Reserve Bank has decided to hold the repo rate at 6.75%.
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The South African Reserve Bank's decision to hold the repo rate at 6.75% affects different players in the property market, revealing a complex landscape of winners and losers.
While agreeing that a predictable plateau is better than another hike, calling it a universal win is a bit of a stretch, says Gerhard Kotze, the CEO and franchisor at RealNet Properties SA.
Last month, the South African Reserve Bank's (SARB) Monetary Policy Committee(MPC) decided to keep the policy rate unchanged, at 6.75%.
Delivering the interest rates decision, SARB Governor Lesetja Kganyago said in previous meetings, they had warned of elevated risks, and have been proceeding cautiously in rate setting with the war in the Middle East.
He said the SARB’s prudent approach is proving appropriate.
Much-needed stability
Kotze says that the SARB kept the repo rate at 6.75% in March, and while that provides some much-needed stability, the reality on the ground depends entirely on which side of the deal you are standing on. He says if you are a cash buyer, you are in a fantastic position.
“You have the negotiating power of a high-rate environment but with the safety of a stabilised ceiling. You aren't chasing the market; the market is coming to you. If you are a buy-to-let investor, you're also winning.
"The aspirational buyer who was hoping for a rate cut is now forced to remain your tenant for another six months.”
A look at the other side
For Developers, Kotze says, sitting on construction debt or sellers who need a quick exit, stability feels a lot like stagnation. He says that every month the rate stays high is another month of squeezed margins and holding costs.
“The real 'winners' right now are the people who have stopped waiting for a rate cut. We know the peak has passed. The smart move is to stop timing the market and start leveraging this plateau before the next easing cycle triggers a fresh wave of competition.”
In the property industry, one does not wait for the wind to change. You adjust your sails to the wind you've actually got, says RealNet Properties SA.
The next phase for the property sector is one of disciplined growth within a constrained global environment, says Ezra Rasethe, investRand’s founder and CEO.
Strong focus on fundamentals
He says stakeholders, including investors, developers, lenders and property professionals will need to operate with a stronger focus on fundamentals such as affordability, cash flow, location and tenant demand.
“With global uncertainty persisting, particularly around inflation and interest rate direction, success will depend on resilience and strategic positioning rather than timing the market perfectly. This means prioritising well-structured investments, maintaining financial discipline and avoiding overexposure to risk.”
investRand says for the sector to continue progressing, it will require stable monetary policy, continued access to financing and a sustained focus on real demand drivers, particularly in rental housing.
“For working professionals, the key takeaway is that this is still an investable market but one that rewards preparation, structure and long-term thinking.”
Shift in decision-making
Ultimately, he adds that navigating this environment successfully will require a shift from reactive decision-making to intentional, system-driven investing, where each decision is aligned to sustainability and long-term performance rather than short-term market movements.
The broader economy is expected to operate in a higher-for-longer interest rate environment.
The decision by the SARB to hold the repo rate reflects a careful balancing act between maintaining price stability and supporting a fragile economic recovery, says Maphefo Sipula, the head of research and impact at Property Point.
She said while the decision had been widely anticipated, it reinforces the reality that the property sector and the broader economy will need to operate in a higher-for-longer interest rate environment in the near term.
“Encouragingly, the hold also signals that the rate hiking cycle has likely peaked, providing a degree of certainty and stability for long-term planning and investment decisions.”
For the property sector, Property Point says this moment represents less of a turning point and more of a transition phase.
It says the absence of a rate cut delays immediate relief for homeowners and developers, but it also allows the market to stabilise and adjust expectations in a more predictable policy environment.
“Investors and developers are likely to remain cautious, with activity concentrated in more resilient segments such as logistics, mixed-use developments, and well-located assets.”