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The month in numbers:
- 14.6% YOY increase in home loan applications
- R1.6 million – average home purchase price
- 10.7% increase in average home price since 2019
- 15% decline in average FTB deposit since Q2 2024
With a strengthening rand holding inflation in check, there’s a strong possibility of another interest rate cut before the end of the year, says Bradd Bendall, BetterBond’s national head of sales. “A firmer rand helps contain inflation, keeping consumer prices within the lower end of the Reserve Bank’s 3 – 6% target band.”
Although the Reserve Bank’s Monetary Policy Committee (MPC) missed an opportunity at the end of September to provide financial relief by dropping the prime lending rate, Bendall says key indicators suggest a rate cut could be on the cards when it meets again in November.
Five repo rate cuts have already gone a long way to reviving market activity, he adds. “BetterBond’s third quarter data shows that home loan applications increased by 11.6% quarter-on-quarter and by a significant 14.6% year-on-year. Notably, since home loan application volumes bottomed out towards the end of 2023, there has been a 26% increase in activity.” As reported in BetterBond’s latest Property Brief (October 2025), a consistent decline in the construction input price index (CIPI), combined with an increase in the residential property price index (RPPI), has narrowed the buyers’ market range – a clear sign of improved demand from prospective homebuyers.
Source: BetterBond Property Brief, October 2025
The more favourable lending rate over the past year has led to a notable uptick in bond approvals, says Bendall, which has reinvigorated the housing market. Nationally, for all regions combined, bond approvals increased year-on-year by 17%, according to BetterBond’s latest data. “Encouragingly, eight of the nine regions reported improvement in the number of home loans granted.” Gauteng remains the top performer with the most home loan approvals, with Johannesburg’s South-Eastern suburbs, the Greater Pretoria and the North-Western suburbs taking the top three spots.
Over the past year, the strongest growth in demand for homes has come from buyers earning less than R15 000 a month. These buyers are most likely to react positively to lower interest rates, explains Bendall. House prices for this income group have therefore increased by 9%. Also encouraging is the year-on-year increase in average home prices for all buyers. Since 2019, home prices have increased by 10.7% and by 8.7% for first-time buyers, underscoring the confidence in property as a sound investment, says Bendall.
First-time buyers have also been given a helping hand with the substantial drop in the average deposit required when applying for a bond, says Bendall. “According to the latest BetterBond Property Brief, the average deposit for these buyers has dropped by 15% since mid-2024. For all buyers, the deposit requirement has dropped by 12%. “Sluggish income growth is likely to keep deposit requirements steady through the remainder of 2025.”
If inflation remains steady and the rand continues to strengthen, there’s a strong possibility of another rate cut in November, says Bendall. Falling global food prices are also expected to ease inflationary pressure locally, creating space for the Reserve Bank to act. “A sixth reduction in the prime lending rate, ahead of the festive season, would provide much-needed relief for consumers and renewed motivation for aspiring homeowners,” he adds. “It would also inject fresh energy into South Africa’s property and construction sectors; both vital engines of job creation and economic growth.”
Read the full report here
