Nedbank chief economist Dennis Dykes on Tuesday said there is now a "significant" danger of another hike in interest rates in April.
The presentation was conducted in conjunction with the French South African Chamber of Commerce and Industry.
Dykes said two weeks ago he would have forecast a 45 percent risk of a rate hike but current conditions had now worsened to such an extent that the expectation is 55 percent.
Considering that Eskom wants to raise tariffs a minimum of 14% (they're appealing to have it raised 24%!!) and petrol price having gone up R1.40 in the last three months I see the chances of an interest rate hike as as a lot higher.
If the rate is hiked, it would mean that the bond rate would be at 15%. That means that for a R960 000 house (the average house price in South Africa according to ABSA) your monthly payment on a 100% bond would be R12 641 a month. If your bond payments should not exceed a third of your income it means that the average household income in South Africa should exceed R36 000 a month. Somehow I don't think that's true.
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