The Reserve Bank Monetary Policy Committee (MPC) interest rate announcement will take place on 28 May 2026. Property investors will be looking for signs of monetary easing. Inflation has been rather stable, while economic growth is feeling the pressure. Some economists believe the SARB will only announce another interest rate cut later in the year. There is uncertainty in global markets and fuel prices. A hold or an interest rate hike may occur this May.
News on inflation and interest rates in South Africa: The rate-cutting cycle from 2024 – 2025
The financial easing cycle started in September 2024, when the repo rate had peaked at 8.25%. This was the highest interest rate seen in 15 years and was kept for over a year. (Source)
The interest rate fluctuations reveal a stop-start approach:
September 2024: Interest rate cut of 25bp to 8.00% (the first cut in four years)
November 2024: Interest rate cut of 25bp to 7.75%
January 2025: Interest rate cut of 25bp to 7.50%
March 2025: Interest rate HELD at 7.50% (due to global tariff uncertainties)
May 2025: Interest rate cut of 25bp to 7.25% (easing was resumed)
July 2025: Interest rate cut of 25bp to 7.00%
September 2025: Interest rate HELD at 7.00% (second hold)
November 2025: Interest rate cut of 25bp to 6.75%
January 2026: Interest rate HELD at 6.75%
March 2026: Interest rate HELD at 6.75%
May 2026: Announcement to be made
What were the patterns since September 2024?
Since the interest rate cut cycle started 14 months ago, the SARB has accounted for 150 basis points in accumulated cuts (1.5 percentage points). This brings the rate down from an 8.25% high to the current 6.75%. This interest rate outcome is welcomed among those who were unsure whether there would be a hold rather than a cut. (Source)
The May 2025 interest rate cut boosted South Africa’s property market, with the repo rate dropping to 7.25% and the prime lending rate falling to 10.75%. Decreased borrowing costs improved affordability levels for investors, reducing monthly bond repayments and creating better opportunities for property investment.
Decreased interest rates in South Africa also improve investor purchasing power and help more buyers qualify for home loans. This increases demand in high-growth nodes such as Johannesburg, Pretoria and Cape Town. It also improves rental yields and cash flow for property investors.
The July 2025 interest rate cut was a relief to property investors. The repo rate was reduced to 7.00%, and the prime lending rate dropped to 10.50%. This means lower monthly bond repayments. This improves affordability levels for homeowners and investors. It also creates opportunities to refinance your current properties and unlock equity to reinvest.
The 20 November interest rate cut was based on data on inflation fluctuations. The October Consumer Price Index was at 3.6%. This is a bit above the SARB’s new target of 3% inflation, however, well within the range of 3-6%.
The inflation target and the decision-making process by the MPC
The most recent interest rate holds in January and March 2026 show the MPC’s caution as it continues balancing inflation control with economic growth factors. Finance Minister Enoch Godongwana formerly supported anchoring inflation closer to 3%, reinforcing the SARB’s longer-term objective of maintaining stronger price stability. Even though inflation has remained relatively contained in early 2026, the MPC is aware of global uncertainties, oil price fluctuations and the potential impact of international trade disruptions on the South African economy.
Current forecasts imply inflation could remain near the lower end of the SARB’s 3%–6% target range throughout much of 2026. Economists are divided ahead of the May 2026 MPC meeting, with some expecting another 25 basis point interest rate cut later in the year should inflation remain stable. On the other hand, some believe the SARB may continue to hold rates steady until there is greater certainty about global market conditions and domestic growth prospects. According to Reuters, SARB Governor Lesetja Kganyago recently stated that the Reserve Bank must “keep its options open” amid ongoing inflation risks and global uncertainty. (Source)
Global and local economic factors affecting the MPC meeting
The May 2026 MPC meeting is taking place amid a resilient South African economy. This is despite global economic uncertainty. Inflation is remaining somewhat stable. A rise in business confidence has stimulated economic activity in South Africa. International risks, such as oil prices, geopolitical tensions, and a decline in global demand, put pressure on the South African market.
Property investors have remained positive amid lower interest rates in South Africa over the past 18 months. This improved affordability and boosted investments in key suburbs such as Johannesburg, Pretoria and Cape Town. The SARB will continue to assess local growth concerns and external risks before deciding on another rate adjustment in 2026.
What does 2026 look like?
Many economists expect the SARB will maintain a cautious approach throughout the remainder of 2026. While another 25-basis-point cut may take place later this year, it depends on inflation trends, fuel prices, global market stability, and South Africa’s economic growth outlook. The recent rate hold in March suggests that the MPC is prioritising long-term stability over aggressive monetary easing.
Importantly, property investors consider the current interest rate environment to be better than it was during the hiking cycle in 2023 and into the beginning of 2024. Decreased borrowing costs, stronger affordability, and better home-loan conditions signal confidence in the South African property landscape. Beginner and seasoned investors can grow their portfolios.
Key takeaways
The next MPC meeting will take place on 28 May 2026. Inflation movements, economic growth conditions and global market risks will be assessed. This is to decide whether to hold or adjust interest rates in South Africa. Economists remain divided. Some anticipate another cautious hold, while others believe a further rate cut later in 2026 remains possible should inflation continue to ease towards the SARB’s preferred 3% target. Some even predict a potential hike.
What does this mean for property investors?
At IGrow, we are seeing investment interest from both beginner and seasoned property investors. A large number of IGrow investors have already expanded their portfolios during the recent interest-rate-easing cycle. Even with recent rate holds in 2026, the current interest rate environment remains far more favourable than it was at the peak of the cycle.
1. Greater affordability
Lower interest rates are reducing monthly home loan repayments, improving affordability for investors and helping more buyers qualify for property financing.
2. Improved cash flow and ROI potential
Whether you own one buy-to-let property or a big portfolio, lower borrowing costs improve monthly cash flow and strengthen your long-term return on investment. This also creates greater opportunities to refinance, reinvest and scale your portfolio strategically.
3. Increased investor confidence
Secure inflation and a supportive interest-rate environment bolster confidence in South Africa’s property market. There is still strong demand for well-located rental properties in key nodes such as Johannesburg, Pretoria and Cape Town.
4. A strategic time to review your portfolio
The property market conditions, at the moment, provide a prime opportunity to assess your investments, refinance and access equity to grow your portfolio. IGrow investors are getting ahead of the next property growth cycle. This is because affordability remains favourable.
Please note, EDGE certified eco-friendly properties are a winner, whatever SARB annouces! Some major banks offer preferential green bonds with 0.25% deductions in interest rates which you will continue to benefit from no matter the interest rate fluctuations. That is a big saving! Read our blog on EDGE certified properties to find our more and see our latest available properties in this category (the post is updated regularly).
Book a free consultation with an IGrow property investment strategist today to review your portfolio structure and explore your next investment opportunity in 2026.
