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Current Prime Interest Rate = 10.5%

On Aug 14, 2009 South African Banks cut the prime interest rate to 10.5%, which is a drop of 0.5% from 11%. This is the sixth rate cut experienced in South Africa since the Reserve Bank decided to drop lending rates in Dec 2008.

We last experienced Interest Rates this low (10.5%) in April 2005.

South African Home Loans Interest Rates, since Jan 4 1999.
Mouse over the graph for more specific details and/or view the table below.


Loading Home Loan Interest Rate Graph

    Prime Interest Rates
    South African Home Loans Interest Rates, since Jan 4 1999.
    14 Aug 09 10.50%   11 Jun 07 13.00%   13 Jun 03 15.50%   14 Jul 99 17.50%
    28 May 09 11.00%   11 Dec 06 12.50%   13 Sep 02 17.00%   02 Jul 99 18.00%
    04 May 09 12.00%   13 Oct 06 12.00%   14 Jun 02 16.00%   03 May 99 19.00%
    24 Mar 09 13.00%   03 Aug 06 11.50%   18 Mar 02 15.00%   02 Apr 99 20.00%
    06 Feb 09 14.00%   12 Jun 06 11.00%   16 Jan 02 14.00%   02 Mar 99 21.00%
    12 Dec 08 15.00%   18 Apr 05 10.50%   01 Oct 01 13.00%   02 Feb 99 22.00%
    13 Jun 08 15.50%   16 Aug 04 11.00%   16 Jul 01 13.50%   04 Jan 99 22.75%
    11 Apr 08 15.00%   15 Dec 03 11.50%   18 Jun 01 13.75%      
    07 Dec 07 14.50%   20 Oct 03 12.00%   01 Feb 00 14.50%      
    15 Oct 07 14.00%   15 Sept 03 13.50%   04 Oct 99 15.50%      
    20 Aug 07 13.50%   15 Aug 03 14.50%   16 Aug 99 16.50%      
    How does this affect my bond?:
    For a bond of R1mil over 20yrs, a 1% movement in the prime rate would equate to a R688 change in your monthly bond instalment.

    While, on a bond of R750k over 20yrs, a 1% movement in the prime rate would equate to a R516 change in your monthly bond instalment.

    Fixed Rate vs Variable Rate:
    The interest rate on a fixed rate homeloan does not change. The advantage of this type of mortgage is that you are protected from rate increases and your monthly payments are consistent.

    The disadvantage is that you will not benefit when the prime rate is dropping.

    Fixed rate will usually be slightly higher than the prime rate at the time of your application.

    Repo Rate vs Prime:
    The Repo rate (repurchase rate)is the rate at which the reserve bank lends rands to our local banks.

    This rate is usually 3.5% lower than the current prime rate.

    Jibar Rate vs Prime:
    The Jibar rate (jhb interbank agreed rate), is used by SA HOME LOANS. While, the Prime rate is used by the Major Banks (STD, ABSA, FNB and Nedbank)

23 Comments For This Post

  1. Alan Ryan Says:
    February 20th, 2009 at 7:07 am

    I need to find out what Standard Banks’ Prime Interest Rate was on the 23rd of November 2000. How do I go about this? Can you assist me?

  2. Gino S Says:
    February 20th, 2009 at 10:02 am

    Hi Alan,
    The Prime Interest Rate for all banks (incl Standard Bank) would have been 14.5% on 23rd of November 2000.

    The interest rate was cut to 14.5% on the 1st of Feb 2000 and remained unchanged, until another cut was made on the 18th of June 2001.

  3. greymacpherson Says:
    May 22nd, 2009 at 2:39 pm

    Hey nice graph, its always easier to see whats going on when you have a picture! Lets just hope we don’t have the currency crash out that we had last time rates were aggressively cut.

  4. Gino S Says:
    May 26th, 2009 at 5:58 pm

    Hi Graeme,

    Yeah, inflation is the hidden tax hey. I might be able to finally afford my bond repayments, but inflation may just erode my property investment.

    Thanx for the comment and complement!
    Gino

  5. Veshlin Ganesh Says:
    May 29th, 2009 at 5:57 am

    I registered my bond on the 17 April. The first debit came off this month.

    At the time of registation the rate was 13%, but changed to 12% early in May. I was debited this month based on 13%.

    Can anyone please explain??

  6. Gino S Says:
    May 29th, 2009 at 9:08 am

    Hi Veshlin,
    I would advise that you contact your bank and enquire about your debt order status.

    A similar thing actually happened to my bond repayment. The problem was that we had signed a document that stipulates that the bond installment is to remain unchanged if rates drop, but will be adjusted accordingly only when rates increase.

    The benefit of this was that if rates dropped I would maintain my monthly expense level, and actually pay off my bond faster

  7. Bongani Says:
    June 3rd, 2009 at 10:20 am

    I am busy shopping around to buy a house, I would like to know if it is a good time to buy a house or rather wait now that we are in a economy meltdown .Interest rates have been dropped by 4.5% to stimulate investment in the economy and give bondholder a much needed relieve to afford bond paymnets.

  8. Matthew Patrick Says:
    July 1st, 2009 at 11:26 am

    Hi!

    What was the 3 month JIBAR rate at 31 December 2008?

  9. B Bhana Says:
    July 6th, 2009 at 10:13 am

    I would like to know if it’s a good time/your opinion about getting your existing home loan, interest rate fixed at this point in time?

  10. Justine Adr Says:
    July 16th, 2009 at 12:08 pm

    Good day,

    We’ve just been informed by our letting agent that our rental on our 2 bedroom flat is going up for the second time in a year due to “market related increases” would this be right if the interest rate has dropped by 4% since we’ve moved in.

    Thanks, I look forward to your response.

    Justine.

  11. Gino S Says:
    July 17th, 2009 at 12:47 pm

    @Justine Adr,

    Although interest rates have come down, inflation still remains high and your agent may be factoring this into the rental. I would suggest that you ask them for a more detailed explanation for the increase.

  12. Marius Says:
    August 14th, 2009 at 6:04 am

    What happened to the graph? Would like to see it…. can you supply to me?

  13. Gino S Says:
    August 15th, 2009 at 7:52 am

    Hi Marius,

    To view the interest rate graph you would need to have JavaScript enabled on your web browser.
    If you continue to have trouble please let me know.

  14. Brian C Says:
    August 28th, 2009 at 10:49 am

    Good Day

    I need to calculate the increase of my installment.
    On 07 july ‘08 my installment was R6787, my installment jumped up to R7150 odd in aug- according to the table the intrest rate increased from 15% to 15.5% in june. Surely my installment should have stayed R6787?

    Very helpful site
    Thank you

  15. Blessing Says:
    October 21st, 2009 at 10:57 pm

    Qn: If my bond is R850 000.00 on prime minus 1,5 interest rate and I pay R300 000.00 towards my bond. If my current payment were R7000.00 per month and I continue paying the same amount. How much longer will it take me to pay off my bond if I have only payed for this property for two years?

    Qn : Is it wise to pay this money towards this bond or rather find some investments?

  16. Riette Says:
    October 23rd, 2009 at 1:40 pm

    Does anyone know where I can get older history? Say, the past 20years?

  17. Riette Says:
    October 23rd, 2009 at 2:02 pm

    Found history on interest rate from 1948!!!
    http://liberta.co.za/blog/prime-interest-rate-in-south-africa-current-and-historical/

  18. Riette Says:
    October 24th, 2009 at 11:46 pm

    To “Blessing”: A really helpful spreadsheet can be found at http://www.vertex42.com/ExcelTemplates/arm-calculator.html. This allows you to enter different interest rates over the bond period and thus do projections in the pay-off period of your bond. It also allows you to add additional deposits and see what that does to the period.

    With reagrds to “Fixing” your interest rate. Info received from Standard Bank to consider is:
    1) The rate you will fix at is higher than the current by 1-2%. For e.g. Current rate is 10.5%, so you will only be able to fix at 11.5 – 12.5%.
    2) If you are currently receiving a concession based on a Group Scheme, you will lose this concession. So your interest rate will revert to the current rate + as per pt1.
    3) After your selected period to fix (12/18/24/36) months, you will probably have to re-apply for the group scheme concession.
    4) If you decided to continue fixing your interest rate after your selected period it will be set at whatever the rate is at THAT stage + the premium stated in pt1.
    5) Use the sheet above to calculate whether this will be worth it for your bond(s).

  19. Mike Says:
    October 30th, 2009 at 12:45 pm

    How can I find out what the average prime rate has been over the last 10 years (on a month to month basis)

    Thanks

  20. Gerrit Says:
    November 2nd, 2009 at 9:56 am

    Can anybody help me with a realistic % escalation in a rental agreement?

  21. Karen Says:
    November 5th, 2009 at 11:05 am

    SUCH a helpful graph! Great starting point from which to work even further back. And thanks to Riette too!

  22. Gino S Says:
    November 5th, 2009 at 1:22 pm

    Thanks for the positive feedback Karen.

  23. Sindi Says:
    December 3rd, 2009 at 1:38 pm

    Can you help me with the projected/forecast prime interest rate as at 31 March 2011, 2012, 1013

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