Those players already involved in the property market in South Africa can feel some relief after the Monetary Policy Committee (MPC) confirmed an anticipated interest rate cut on 31 July 2025. The South African Reserve Bank (SARB) decreased the repo rate by another 25 basis points. The repo rate now stands at 7.00%. While this South African interest rate cut may seem small, it has far-reaching effects, particularly for home loan holders who pay monthly repayments and will now pay less. (Source)
Current homeowners also now have the opportunity to unlock equity in their existing properties to refinance and reinvest. And of course, for those looking to enter the property market as first-time buyers, this is an exciting opportunity!
IGrow Home Loans, a company within the IGrow Group, has already seen an increase in home loan activity before the July interest rate cut, securing R145 million in home loans in June alone. These patterns demonstrate how IGrow is well-positioned to help South African property investors capitalize on positive changes in the economic climate.
If you are considering breaking into the property market, now is the right time! Or if you are looking to grow your IGrow portfolio or refinance, the current economic climate falls in your favour. We’ll show you how the recent interest rate cut in South Africa is of benefit to you.
Welcome news: the SARB lowers the repo rate to 7%
Following the MPC meeting on the 31st July 2025, the SARB has decided to cut the interest rate by 25 basis points. This lowers the repo rate to 7%, and the prime lending rate to 10.50%. (Source)
What is the rationale behind these moves by the MPC and the SARB?
Inflation has decreased and is currently within the SARB’s target range of 3% to 6%. The core inflation rate dropped to 4.5% in June 2025. The SARB aims to secure inflation closer to 3% . This is a level they now see as ideal in terms of long-term stability. (Source)
Bond repayments are now cheaper, due to the July 2025 interest rate cut
The most beneficial result of the interest rate cut in South Africa is that home owners and property investors paying off their loans will now notice a reduction in monthly home loan repayments. If you are a property owner, your bond repayment will be a lighter load than before, easing your overall financial position.
You may now be able to refinance your properties, reinvest and use equity from current properties to purchase new ones. (Read our recent blog post that explains the ins and outs of “Retaining, Refinancing, and Reinvesting”: Unpacking Property Refinancing: When and Why Does it Make Sense?).
Our property investment specialists at IGrow have noted that now is the right time to refinance and reinvest with lower home loan repayments for all home loan-financed property owners. IGrow Home Loans is ready to help you take the next step in your property journey with a favourable interest rate, as they regularly secure lower-than-average bond rates.
Exploring home loan repayment savings
Below, you will see a table adapted from calculations in a recent BusinessTech article. It highlights the landscape for home owners whose monthly bond repayments are benefited by the July 2025 interest rate cut. The revised prime lending rate of 10.50% is compared to May 2025’s prime lending rate of 10.75%.
| Home Loan Repayment Savings After the July 2025 Interest Rate Cuts Reduce Prime Lending Rates |
| Bond Amount | May 2025 Prime Lending Rate (10.75%) | July 2025 Prime Lending Rate (10.50%) | Savings Per Month |
| R850,000 | R8,629 | R8,486 | R143 |
| R1,000,000 | R10,152 | R9,984 | R168 |
| R1,500,000 | R15,228 | R14,976 | R252 |
| R1,695,257 | R17,211 | R16,925 | R286 |
| R2,000,000 | R20,305 | R19,968 | R337 |
| R2,500,000 | R25,381 | R24,960 | R421 |
| R3,000,000 | R30,457 | R29,951 | R506 |
| R3,500,000 | R35,533 | R34,943 | R590 |
| R4,000,000 | R40,609 | R39,935 | R674 |
| R4,500,000 | R45,685 | R44,927 | R758 |
| R5,000,000 | R50,761 | R49,919 | R842 |
This clearly shows how home loan owners will benefit from a lower prime lending rate, positively affecting their monthly home loan repayments and cashflow. Get in touch with IGrow Wealth’s friendly property investment strategists today, so we can assess what your next step should be in the property market.
Cape Town and Gauteng property investors are positively affected by the July 2025 interest rate cut
Cape Town, Pretoria and Johanneseburg are known for strong property markets for buy-to-let investment, with high demand for residential units by tenants seeking convenience, security and employment accessibility as well as great urban lifestyles. At IGrow, our properties in security complexes in Cape Town and rental properties in security complexes in Johannesburg meet the needs of a modern tenant.
Ryan Greeff, the CEO of Quay 1 International Realty, “is pleased to see the South African Reserve Bank take a proactive step in decreasing the repo rate to 7.00%. This 25 basis point reduction is a positive move for the property market, particularly in Cape Town, where affordability and buyer confidence are highly sensitive to interest rate adjustments.” (Source)
“Lower interest rates have historically brought about a surge in market activity, especially from first-time buyers who often struggle with high borrowing costs. With the spring selling season approaching, we anticipate this rate cut will provide the perfect window for many aspiring homeowners to enter the Cape Town market.” (Source)
Lower interest rates imply better affordability, improve home loan approval rates, and make leveraging 100% home loans more affordable for investors. There is also a notable anticipated increase in the demand for buyers seeking rental units to grow their portfolios, and a high tenant surge for those looking for prime rental homes.
In the second quarter of 2025, IGrow considers it an ideal buyer’s market for those refinancing, growing their portfolios, or first-time rental unit buyers
In 2024, people were anticipating the 2025 interest rate cuts. With the interest rate cuts and reduced repo rate now materialising, why wait to invest when the time to invest is now?
The recent South African interest rate cut also means banks are more amenable to approving home loan applications. Mitigating credit risks is now more possible, so South African banks are going to be willing to award home loans in the current financial market. With the significant home loan repayment savings, first-time rental home buyers are on the front foot, ready to start their investment journeys.
In partnering with IGrow Home Loans, and by reflecting on our team’s success rate and recent R145 million secured in successful home loan applications, you are on the road to property investment success!
If you are a multi-property portfolio holder with IGrow, our experts in property investment strategy, alongside our expert bond originators, recommend accessing the equity in one/more of your properties to refinance and reinvest. Our Home Loans team is poised to begin helping you refinance and reap rewards if the timing is right for you to grow your portfolio and scale up your investments!
Key Takeaways
- The MPC has triggered a lower repo rate of 7.00%, further reducing the prime lending rate to 10.50%. This is thanks to the interest rate cut in July 2025.
- The South African Reserve Bank (SARB) is working hard to ensure inflation remains close to 4.5%, and the SARB has already reduced core inflation from a former higher inflation estimate.
- Homeowners paying off their home loans will now benefit from reduced monthly home loan repayments. These monthly repayment amounts are now cheaper by anything from R143 to R842, based on your home loan amount.
- The IGrow Home Loans team has secured R145 million in home loans in June, and even more in July, indicating increased property investor confidence with lower interest rates on home loans.
- Cape Town, specifically, will benefit from a buyer’s market surge, supported by great tenant demand. Gauteng is close behind with a huge uptick in rental demand near business hubs, good schools and tertiary institutions.
- Now, it is a prime time for first-time buyers to break into the property market, with increased affordability and increased bank-financed home loan approval rates anticipated.
- It is also an ideal time to refinance and reinvest the equity from your current properties.
What will you notice from the recent interest rate cut?
If you are a potential first-time buyer or looking to grow your investment property portfolio, IGrow Home Loans will aid you in securing the best home loan deals possible. With our almost two decades in operation, our excellent rapport with South African banks means that utilising our bond origination services is a win-win for you as an investor.
Our bond originators submit your home loan applications to multiple major banks, and we compare offers and ensure we secure the best interest rates and loan terms for your specific needs. If you are refinancing, our team is adept at securing refinanced, new home loans, too.
Conclusion
IGrow Home Loans is closely watching the property market. With inflation stabilising, and optimal market conditions, we believe now is the ideal time to start investing or continue growing your property portfolio.
With the interest rate cut recently announced in South Africa, home loan repayments are reduced, affordability is on the rise, and bank approval of home loans is anticipated to be favourable, going forward. This is your golden opportunity to invest in property, for beginner and seasoned investors alike.
Contact IGrow now, to capitalise on the improved market conditions, after a favourable interest rate cut in July 2025 that has paved the way for property investors looking to turn a great profit.
