The chairman of the real estate company estimated that actual property transfers have decreased by 10% since the Reserve Bank began consistently increasing the repo rate from November 2021.
Chairman of the Seeff Property Group, Samuel Seeff, said higher interest rates seen since November 2021 have driven property sales down.
Seeff’s comments come ahead of the repo rate announcement by the Reserve Bank on Thursday afternoon.
The repo rate rose from 3.5% at the end of 2021 to 7.25% currently.
The prime lending rate – the interest rate consumers pay back to commercial banks for loans currently sits at 10.75%.
This means it costs more for consumers to pay off their car and home loans.
Seeff said there has been an impact on the property market because of these factors.
“What we’ve seen is that the activity has decreased a little bit. Internet enquiries and people looking for properties has come off a little bit. We see generally that there has probably been a 10% reduction in the actual properties transferred over the last period.”
But he said the market remains stable.
“I think we do have to expect that there will be a lull given the interest rate increases but a reasonably priced property should still find a buyer.”
Source: EWN