Make the most of the Interest rate
Buying property in Gauteng or anywhere else in South Africa can be a stressful task. In this article we will discuss how you can make the most of the current interest rate and ensure that once the tough times hit you will be better off.
Have you been considering buying property in Gauteng, but are a bit stressed out due to the recent financial climate in South Africa? Rest assured that you are not alone, let’s take a look at some of the ways you can benefit from the positive news regarding the interest rate.
It is all too easy to let the good news regarding the prime lending rate remaining at 10.25% as well as the repo rate staying at 6.75% get to your head and therefore slack off on a few monetary concerns. But according to experts now is the time to maximize this opportunity and ensure that in tougher times to come it is less felt.
One way that you can do this is by adding a little extra to your monthly bond installments, even as little as R300 can see you making a massive saving in the long run, not to mention shorten your repayment period.
Adrian Goslett, CEO of RE/MAX Southern Africa says “I would recommend that homeowners tighten their belts now in preparation for incremental increases throughout 2019 by investing an extra 0.25% of their home loan instalment in an interest-bearing account.”
A good suggestion is to treat the situation like the interest rate has already increased, by putting in a little extra now you could potentially make massive savings in the future and lighten the load when the interest rate does increase.
It has been calculated that on a property costing R1,500 000.00 with an interest rate of 10.25% just by adding R500 to your monthly installment of R14,700.00 you will save R200,000.00 and shorten your repayment period by as much as 2 years.
