There is a strong possibility of an interest rate hike at the end of this month.
Property experts are predicting a hike of 0.25% or 0.5% at the most, and if this materialises then it could be another skok for consumers, reports IOL.
However, FNB’s view is that interest rates have reached their peak level and will remain unchanged “from here onward until well into 2024”, says property economist John Loos.
“Therefore, in the near term, we don’t expect any change in the direct impact on the cost of servicing mortgage debt for existing owners.”
Nick Tyson, managing director of Tyson Properties, also does not believe the interest rate will be raised but if it is, “it will be by 0.25%”.
Tyson CEO Nick Pearson does not predict an increase this month either, but “will not be surprised if we see another increase this year”.
BetterBond shares the view of some economists and analysts that the rate will be increased by 0.25%, taking the repo rate to 8% and the interest rate to 11.5%.
But good news, says chief executive Carl Coetzee, is “this is likely to be the last increase we will see in this current rate-hiking cycle”.
“It is expected inflation is unlikely to remain about the Reserve Bank’s upper target range for much longer, so we should see a lowering of interest rates in the second half of this year.”
Coetzee says an increase in the repo rate will negatively affect homeowners, especially in an economic climate where fuel, electricity and living expenses are also on the rise.
dailyvoice@inl.co.za