Interest Rate Holds Steady at 10.25% — What It Means for Buyers

The South African Reserve Bank's Monetary Policy Committee (MPC) held the repo rate steady at 8.25% in its February 2026 meeting — keeping the prime lending rate at 11.75%. For prospective homebuyers, this pause signals both stability and a window of opportunity.

What the steady rate means for your bond

A prime rate of 11.75% means that for every R1 million borrowed over 20 years, your monthly repayment sits at approximately R10,480. While this remains elevated compared to the historic lows seen in 2021, the MPC's decision to hold indicates that the tightening cycle has likely peaked.

Leading economists from FNB and Absa both forecast at least two 25-basis-point cuts before year-end, which would bring monthly repayments on a R1.5 million bond down by roughly R350 per month — not transformational, but a meaningful signal that conditions are improving.

How banks are responding

Several major lenders have quietly adjusted their credit appetites in anticipation of easing conditions. Standard Bank and Nedbank both reported increased home loan approvals in Q4 2025, and FNB's Home Buying Confidence Index rose to 56 — its highest reading since mid-2023.

Pre-approval volumes at Bracha Homes have risen 18% quarter-on-quarter, suggesting buyers who sat on the fence through 2024 are returning to market.

Suburbs benefiting most from stable rates

In a stable-rate environment, mid-market suburbs tend to benefit disproportionately as first-time buyers can finally model repayments with confidence. Areas like Linksfield, Bruma, and Kensington in Johannesburg, and Parow and Bellville in Cape Town, are seeing renewed interest from buyers in the R1.2M–R1.8M bracket.

Practical advice for buyers

If you are currently renting and considering a purchase, the flat rate decision gives you a reliable baseline for bond affordability calculations. Use the bond calculator on your preferred listing page and factor in a conservative buffer — assume rates will stay flat or dip slightly rather than planning on aggressive cuts.

Speak to a bond originator early. ooba and BetterBond both report faster turnaround times as banks compete for new bond business, and multi-bank applications remain the single most effective way to secure a competitive interest rate.

The bottom line

A hold is not a hike. The fact that rates are not rising means your purchasing power is protected. Buyers who act in the current window — before the anticipated cut triggers renewed competition in the market — are likely to find better availability and more motivated sellers than they will in six months' time.