Rate Hikes Unlikely to Weigh on South Africa Home Buying in 2022
A residential building under construction next to an apartment block in Johannesburg, South Africa.
Photographer: Waldo Swiegers/BloombergThis article is for subscribers only.
Rising interest rates are unlikely to affect home buying in South Africa this year, according to FirstRand Ltd.’s First National Bank.
The lender expects the central bank to raise its benchmark rate by at least 75 basis points in 2022 because of mounting inflationary pressures and plans by advanced economies including the U.S. to raise borrowing costs. While higher rates may have a “cooling effect” on market transactions and price growth, the current wave of buying is largely being driven by wealthier buyers who are less sensitive to interest rates, Siphamandla Mkhwanazi, an economist at FNB, said in a note.