Homeowners and those with large amounts of debt will have to fork out hundreds of rands extra on interest after the Reserve Bank increased the repo rate by 50 basis points to 4.75%. This is the largest hike since January 2016. This takes the interest rate to 8.25%. The Reserve Bank was under pressure to hike rates as inflation in April hit 5.9% for the third time in 5 months. Reserve Bank governor, Lesetja Kganyago says higher food and fuel prices are contributing to soaring inflation.

While homeowners worry about the impact of the rate hike on their bond repayments, a bond expert says it’s a reminder to buyers, to focus on what they can afford when investing in property to mitigate the impact of rate increases. BetterBond’s regional sales manager Colin Strumpher says electricity, food & fuel prices are soaring/