If you have a home loan, or you’re about to apply for one, today’s announcement from the Reserve Bank probably has you reaching for a calculator. Your monthly repayment is about to go up again, and if you’re house hunting, the amount the bank is willing to lend you may shrink a little.
The good news is that the change is small and you can plan for it. Below we answer the questions South African homeowners and buyers are asking most, with real rand figures, so you know exactly where you stand.
What did the Reserve Bank announce?
The South African Reserve Bank raised the repo rate by 0.25%, from 7% to 7.25%. That lifts the prime lending rate from 10.5% to 10.75%.
Governor Lesetja Kganyago delivered the decision, and all six members of the Monetary Policy Committee voted for the increase. This follows an unexpected hold in July and is the second rate hike of 2026.
Why did the SARB raise interest rates?
In short: to keep inflation from climbing further. Inflation is currently 4.4%, while the Reserve Bank targets 3% with a one percentage point tolerance either side.
The decision was shaped largely by global tension, particularly escalating conflict in the Middle East and the resulting disruption to oil shipping routes, which adds inflationary pressure. Closer to home, petrol prices eased between June and August but are now rising again, and the central bank wants to prevent fuel costs from pushing up other prices.
How much will my bond repayment increase?
For most homeowners, the increase is between roughly R120 and R340 a month. Here’s what the 0.25% hike means on a 20-year bond at prime:
| Bond amount | Repayment at 10.5% | Repayment at 10.75% | Monthly increase |
|---|---|---|---|
| R750,000 | R7,488 | R7,614 | R126 |
| R1,000,000 | R9,984 | R10,152 | R168 |
| R1,500,000 | R14,976 | R15,228 | R253 |
| R2,000,000 | R19,968 | R20,305 | R337 |
If your rate is prime plus or minus a margin, or you’re partway through your loan term, your figure will differ. Use the Bond Finders Repayment Calculator to see your own number.
When will I see the higher repayment?
According to The Citizen, the new rates take effect from Friday, 25 September 2026. Most banks adjust variable-rate home loans automatically, so you should see the higher instalment on your next debit order or the one after, depending on your billing cycle. Your bank will usually notify you of the new amount by SMS, email or statement.
Does the rate hike affect fixed-rate bonds?
No, not while your fixed period lasts. If you fixed your interest rate, your repayment stays the same until the fixed term ends. After that, your loan normally moves back to a variable rate linked to prime at whatever level prime is then.
Most South African home loans are variable, which means they follow every repo rate change, up or down.
Can I still afford to buy a home after the rate hike?
Yes, but your budget may stretch slightly less far. Banks work out how much they’ll lend you based on the monthly repayment you can afford, so when rates rise, the loan amount that fits that repayment falls.
For example, if you can comfortably afford R15,000 a month over 20 years, you would have qualified for a bond of about R1.50 million at 10.5%. At 10.75%, that same R15,000 supports about R1.48 million. That’s a difference of roughly R25,000 in buying power, which is meaningful but unlikely to rule you out of the market.
Run your numbers through the Affordability Calculator to see your updated range before you start viewing properties.
Should I buy now or wait for rates to come down?
There’s no single right answer, but waiting for the “perfect” rate is rarely a strategy on its own. Rates can move in either direction, property prices and rental costs keep changing, and every month you rent is a month you’re not building equity.
Investec economist Tertia Jacobs described this hike as a risk-management move rather than the beginning of an aggressive series of increases. That suggests a measured environment rather than a runaway one.
The better question is whether the repayment is comfortable for you today, with room to absorb another small increase. We cover this decision in more depth in Buy now or wait? How to make a smart property decision when interest rates are higher.
What can homeowners do to soften the impact?
You have more control than it may feel like. These steps can help:
- Check your new instalment. Look out for your bank’s notification and update your monthly budget straight away.
- Keep paying a little extra. If you can afford it, even an extra few hundred rand a month cuts your total interest and loan term. The Extra Payment Calculator shows the savings.
- Review your other debt. Car finance, credit cards and personal loans on variable rates are rising too, so prioritise paying down the most expensive debt first.
- Talk to your bank early. If the increase puts you under pressure, speak to your bank before you miss a payment. Options may be available, but they’re easier to arrange early.
- Build a buffer. Setting aside the difference in a savings account now gives you breathing room if rates rise again.
How can a bond originator help when interest rates rise?
When rates go up, the interest rate the bank offers you personally becomes even more important. A difference of just 0.25% to 0.5% on your individual rate can save you more than today’s entire hike.
A bond originator like Bond Finders submits your application to multiple banks, so they compete for your business and you can compare offers side by side. The service costs you nothing. Read more in Bond Originator South Africa: How It Helps Buyers Compare Banks.
Frequently asked questions
What is the prime lending rate in South Africa now?
The prime lending rate is 10.75%, following the 0.25% repo rate hike to 7.25% announced on 23 September 2026.
Will interest rates go up again this year?
Nobody can say for certain. The SARB meets once more in 2026, and its decision will depend on inflation, fuel prices and global conditions. Budgeting for a little extra headroom is sensible.
Does my existing pre-approval still stand after a rate hike?
Pre-approvals are based on your affordability at the time of assessment, so a rate change can affect the amount. If you were pre-approved close to your maximum, it’s worth checking your figures again. See our Home Loan Pre-Approval Checklist.
Does a higher interest rate affect my deposit?
Not directly. However, a bigger deposit reduces the amount you borrow, which lowers your monthly repayment and makes higher rates easier to manage.
Does anyone benefit from a rate hike?
Savers can gain, as higher rates may improve returns on some savings products.
I’m a first-time buyer. Should this change my plans?
Not necessarily. Focus on a repayment you’re comfortable with and get pre-approved. Our first-time buyer guide walks you through the steps.
Get the best rate in a higher-rate market
A rate hike makes shopping around more valuable than ever. Bond Finders compares South Africa’s major banks on your behalf to help you secure a better rate, at no cost to you.
Get pre-qualified, contact our consultants to find out what you qualify for today.