2020 vs Recent Years

There have been many discussions about the record breaking low repo rate introduced by the South African Reserve Bank in May this year.

For illustration purposes we compare the cost of borrowing a R1 000 000.00 between 1985-2018, 2019 and today. The respective average prime interest rates during the periods are 14.42%, 10.14% and 7.25%.

The reduced prime interest rate relates to a R4 040.00 saving compared to the 1985-2018 average, and a R1 553.00 saving compared to last year.

The saving might sound insignificant, but to landlords with property portfolios which are highly geared, the saving is an absolute necessity for survival.