Interest rates: Do you even realise how much more you’re paying on your home loan?

If you add it up, the extra money you are paying on your home loan at the moment may shock you. Picture: Shvet Production/Pexels

If you add it up, the extra money you are paying on your home loan at the moment may shock you. Picture: Shvet Production/Pexels

Published Dec 29, 2022

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From the first interest rate hike in January to the final increase for 2022 in November, homeowners have been riding a rollercoaster that has only been climbing.

And even though you know your bond repayments have been steadily increasing this year, you may not realise just how much extra you are currently forking out each month.

We have done the math for you; so brace yourself for the results.

Total increase for 2022

Based on your home loan amount, you are paying a heck load more for your property now than you were at the beginning of the year. The prime lending rate has ultimately increased from 7.5% to 10.5%.

You are therefore paying 3% more, a figure that may not seem that high, but has actually increased your monthly repayments by thousands of rands – and that is if you bought an average-priced property. For those with R10 million home loans, you are paying almost R20 000 more.

Based on your home’s value, take a look at how much you are now paying compared to what you were paying at the end of January.

  • R1m: R1 928
  • R1.5m:R2 892
  • R2m: R3 856
  • R2.5m:R4 819
  • R3m:R5 783
  • R4m:R7 711
  • R5m:R9 636
  • R8m:R15 423
  • R10m:R19 318

Don’t believe us? Then look at the month-to-month calculations below where we show you just how much more you are paying now compared to January 2022.

January

The first month of 2022 saw an interest rate increase of 0.25%, setting the prime lending rate at 7.5%.

If you were a homeowner at that time, this is how much you would have roughly been paying based on your home’s value:

  • R1m: R8 056
  • R1.5m:R12 084
  • R2m: R16 112
  • R2.5m:R20 140
  • R3m:R24 168
  • R4m:R32 224
  • R5m:R40 280
  • R8m:R64 447
  • R10m:R80 559

March

This month, the South African Reserve Bank increased the repo rate by another 0.25%, which took the prime lending rate to 7.75%.

This increase would have seen you now paying the following amounts on your home loan:

  • R1m: R8 209 (+R153)
  • R1.5m:R12 314 (+R230)
  • R2m: R16 419 (+R307)
  • R2.5m:R20 524 (+R384)
  • R3m:R24 628 (+R460)
  • R4m:R32 838 (+R614)
  • R5m:R41 047 (+R767)
  • R8m:R65 676 (+R1 229)
  • R10m:R82 095 (+R1 536)

May

The third interest rate hike was a steep one as the prime lending rate was hiked by 0.5%, meaning that you would now have be paying 8.25% in interest on your home loan.

This is the effect it had on your bond repayments:

  • R1m: R8 521 (+R312)
  • R1.5m:R12 781 (+R467)
  • R2m: R17 041 (+R622)
  • R2.5m:R21 302 (+R778)
  • R3m:R25 562 (+R934)
  • R4m:R34 083 (+R1 245)
  • R5m:R42 603 (+R1 556)
  • R8m:R68 165 (+R2 489)
  • R10m:R85 207 (+R3 112)

July

After the shock increase of 0.5% in May, homeowners were hit with an even bigger one this month – a 0.75% hike which took the interest rate to 9%.

This would have taken your home loan repayments to:

  • R1m: R8 997 (+R476)
  • R1.5m:R13 496 (+R715)
  • R2m: R17 995 (+R954)
  • R2.5m:R22 493 (+R1 191)
  • R3m:R26 992 (+R1 430)
  • R4m:R35 989 (+R1 906)
  • R5m:R44 986 (+R2 383)
  • R8m:R71 978 (+R3 813)
  • R10m:R89 973 (+R4 766)

September

By this stage of the year, homeowners were already dizzy as a result of the interest rate increases, and still, in fact, reeling from July’s massive hike. So when the SARB announced that another 0.75% increase was in order – taking the prime lending rate to 9.75%, you would have been forgiven if you were considering just selling your home.

Your home loan repayments increased by this amount in September:

  • R1m: R9 485 (+R488)
  • R1.5m:R14 228 (+R732)
  • R2m: R18 970 (+R975)
  • R2.5m:R23 713 (+R1 220)
  • R3m:R28 456 (+R1 464)
  • R4m:R37 941 (+R1 952)
  • R5m:R47 426 (+R2 437)
  • R8m:R75 881 (+R3 903)
  • R10m:R94 852 (+R4 915)

November

The final interest rate increase for 2022 was a tough blow for homeowners as the hike was yet another 0.75%. This took the prime lending rate to 10.5%.

As of now, you are paying the following amounts on your home loan repayments:

  • R1m: R9 984 (+R499)
  • R1.5m:R14 976 (+R748)
  • R2m: R19 968 (+R998)
  • R2.5m:R24 959 (+R1 246)
  • R3m:R29 951 (+R1 495)
  • R4m:R39 935 (+R1 994)
  • R5m:R49 919 (+R2 493)
  • R8m:R79 870 (+R3 989)
  • R10m:R99 838 (+R4 986)

The SARB’s next interest rate decision will come at the end of January, and homeowners would be wise to expect another increase, even if it may seem like only a small one in comparison to previous hikes.

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