Home Loans News: ABSA
The growth of House Prices is slowing and Home Loan interest rates are expected to continue to increase, that’s according to ABSA – one of the largest mortgage providers in South Africa.
According to the ABSA House Price Index the year-on-year growth of residential property prices slowed from 14.3% in May 2006 to 13.6% in June. The lowest it’s been since January 2000.
Interest rate hikes have contributed to the current downward trend in property prices and ABSA economists are predicting further rate hikes later this year.
â€œInterest rates are forecast to rise further by 50 basis points at each of the remaining MPC [monetary policy committee of the South African Reserve Bank] meetings in August, October and December this year. This will bring the prime interest rate and variable mortgage rates to a level of 12,5% at year end,” Absa said.
With Home Loan interest rates expected to increase further this year, the question of whether to Fix your home loan rate has become hotly debated.