Global interest rate increases and rising inflation have made purchasing a home more difficult this year, regardless of where new homebuyers are looking.
The latest interest rate hike by the South African Reserve Bank (SARB) in late November raised domestic interest rates by 75 basis points, bringing the prime lending rate to 10.5%.
As a result, an R1 million bond will now cost an extra R500 per month if paid off over a 20-year period.
According to Tony Clarke, managing director of Rawson Property Group, South African homebuyers will continue to feel the pinch and tighten their belts as interest rates remain unchanged.
Economists at Matrix Fund Managers, including Carmen Nel, believe that global uncertainty about inflation outlooks will put pressure on the SARB to continue raising interest rates.
According to the most recent International Monetary Fund (IMF) data, which was last updated on September 22, 2022, global house prices have been steadily rising.
Hotspot for emigration Australia had the second-highest annual increase in real house prices, at 19%, trailing Turkey at 26% and just ahead of New Zealand at 18%.
According to the IMF, the Netherlands was also among the top ten increases, with an annual increase of 10.49%.
The graph below depicts the IMF’s reported steady increase in global real house prices:
BusinessTechAfrica compared what R6 million gets you around the world to what it gets you in South Africa:
South Africa
Cape Town
4 Bedroom House for Sale in Rondebosch – R5,900,000
Johannesburg
4 Bedroom House for Sale in Craighall Park – R5,995,000
Pretoria
4 Bedroom House for Sale in Rietvalleirand – R5,950,000
United Kingdom
2 Bedroom Boat house for sale in Blomfield Road, London – R5,875,900
4 Bedroom House for sale in Rake Lane, Manchester, M27 – R6,093,600
Netherlands
1 Bedroom apartment for sale in Zegwaart-South-West – R5,025,000
Australia
4 Bedroom house for sale in Perth, 28 Torcross Street, Warnbro – R5,960,519
