SA Homebuyers hit with R640 more a month

• Average monthly bond repayments have risen by R640, despite prime remaining unchanged at 10.5% compared with a year ago.
• The average SA home now costs R1.77 million, pushing the estimated average bond repayment to R15,875 a month.
• Buyers are becoming more price-sensitive, making accurate property pricing and competitive home-loan rates increasingly important.

House prices push up the cost of buying

‍South African homebuyers are paying an estimated R640 more every month on the average home loan than a year ago, as rising property prices collide with borrowing costs that have provided no year-on-year relief.

New research from eXp Realty South Africa shows the estimated average monthly cost of servicing a home loan has increased by 4.2% over the past 12 months.

The critical factor is that this increase has not been caused by a higher prime lending rate compared with a year ago. Prime currently stands at 10.5%, exactly where it was 12 months earlier.

Instead, house price growth has effectively flowed directly into the size of the mortgage and therefore the buyer's monthly repayment.

According to the research, the average South African property now costs R1,766,796, an increase of 4.2% over the past year. 

Based on a 10% deposit, that means the numbers for the average buyer now look like this:

• Average property price: R1,766,796
• 10% deposit: R176,680
• Estimated home loan: R1,590,116
• Prime lending rate: 10.5%
• Estimated monthly repayment: R15,875
• Increase from a year ago: R640 per month
• Additional annual cost: R7,680

A year ago, the equivalent estimated repayment was R15,236 per month. For households already contending with higher living costs, another R640 every month can materially affect affordability, particularly when added to rates, levies, insurance, maintenance and other costs associated with owning a home.

Rates offer buyers little relief

‍South African buyers have experienced a volatile interest-rate environment. The South African Reserve Bank cut the repo rate in November 2025, but that reduction was reversed in May 2026 with the first rate increase since May 2023.

The result is that buyers are once again facing a prime lending rate of 10.5%, the same level as a year ago. That has removed the interest-rate cushion that could otherwise have offset some of the effect of rising property prices.

Andrew Thompson, Country Leader of eXp Realty South Africa, says continued house price growth is nevertheless a positive indicator for the underlying residential market.

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"House prices have continued to grow at a healthy pace over the last year, which is a positive signal about the underlying strength of the South African market, but with interest rates unchanged there has been nothing to soften the impact on buyers."

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Thompson says every rand of price growth has effectively flowed into monthly repayments, while May's rate reversal has made it more difficult for buyers to plan around expectations of continually falling borrowing costs.

The result is a more considered buyer. "That naturally makes them more considered about what they buy and what they are willing to pay for it."

For sellers, Thompson says the fundamentals therefore matter more. Demand remains in the market and banks continue to lend, but buyers taking on larger monthly commitments are likely to scrutinise value much more closely.

Accurate pricing, presentation and effective marketing could increasingly determine which properties sell quickly and which remain on the market.

The interest rate you secure matters

‍MultiNET Home Loans CEO Shaun Rademeyer says the affordability squeeze should not be interpreted as banks losing their appetite to lend. Rather, the pressure is increasingly sitting with the buyer's monthly household budget.

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"Banks remain competitive for good-quality home loan applications, but buyers are understandably becoming more price-sensitive when both property prices and their broader household expenses are increasing."

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Rademeyer says the additional R640 monthly repayment also illustrates why buyers should pay close attention to the interest rate offered on their mortgage, rather than simply celebrating approval.

On a bond of approximately R1.59 million, relatively small differences between rates offered by competing banks can translate into meaningful savings over a 20-year loan term.

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"Buyers should not look only at whether their home loan is approved. They should also look at which bank is giving them the best overall deal."

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Comparing offers from multiple lenders and negotiating the rate can therefore become an important affordability tool. Rademeyer says buyers are also becoming more disciplined about distinguishing between the maximum amount a bank will lend them and the amount they can comfortably afford.

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"A home should remain affordable not only on the day you buy it, but throughout the interest-rate cycle."

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What the research says about affordability

‍The eXp Realty analysis used the average South African property price, a 10% deposit, prevailing prime lending rate and a 20-year mortgage term to estimate how the monthly cost of homeownership has changed.

The average property price of R1,766,796 was sourced from ooba Home Loans' Q2 2026 data, while the prime lending rate was sourced from the South African Reserve Bank. The analysis highlights an important distinction in the affordability debate.

Static interest rates do not mean static homeownership costs.‍

When house prices rise, buyers need larger deposits and larger mortgages. If borrowing rates do not decline sufficiently to compensate, the cost ultimately appears in the monthly repayment.

For an average buyer, the current calculation translates into R7,680 more every year than 12 months ago. And that is before taking into account other ownership costs.

Buyers need to focus on the total deal

‍South Africa's residential market continues to demonstrate underlying demand, but affordability is becoming an increasingly important constraint on how buyers make decisions.

The additional R640 monthly repayment may appear relatively modest in isolation, but over a 20-year mortgage it highlights how property price movements and financing costs interact.

For buyers, the lesson is increasingly to focus on the total economics of the transaction: purchase price, deposit, interest rate, monthly repayment and the ongoing costs of ownership.

For sellers, rising repayments mean buyers have greater reason to challenge ambitious asking prices and demand demonstrable value. And for investors, the same principle applies: the purchase price is only the starting point. Financing costs ultimately determine whether the numbers work.

With prime offering no year-on-year relief, affordability will increasingly depend on buying at the right price, securing the best possible finance and leaving sufficient room in the household budget to withstand the next turn in the interest-rate cycle.

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