Keep sustainable investment top of mind, Tyson Properties advisesas Reserve Bank makes another rate cut

The decision by the South African Reserve Bank Bank’s Monetary Policy Committee (MPC) to cut interest rates by 25-basis-points from 7% to 6.75% has been welcomed by Tyson Properties CEO, Chris Tyson. 

He says that although 2025 has been a turbulent one for the economy as a whole, a cumulation of smaller interest rates since September 2024 has added up to good news for the property sector. With cuts now reaching the 150-basis point mark, he believes that this could continue to have a positive impact on the entire property sector going forward into 2026. 

Tyson’s optimism is not only based on interest rates, however. 

He is encouraged by the creation of a new inflation target at 3% which immediately replaces the previous target range of between 3 and 6%. This will apply over the next two years and is expected to not only decrease inflation expectations but create room for lower interest rates. This supports household spending and business investment, boosting economic growth and job creation.  

The second is a cautiously optimistic Mid-term Budget which forecasted real GDP growth of 1.2 per cent for 2025, more than double the economic growth in 2024. Moreover, this recovery is expected to see further growth over the medium term at an average 1.8 per cent between 2026 and 2028. 

This could be a signal for property investors sitting on the fence to enter the market. He says that, since the end of 2024, there has been a cautious revitalisation within the residential property sector, especially in the lower and mid-value segments of the market where affordability gains from lower interest rates are most pronounced.

The promise of further interest rate cuts could see more new entrants into the property market. 

However, he admits that many potential buyers remain understandably cautious.  

Tyson suggests that beginning of the year service charge increases which can include everything from rates, water and electricity to annual insurance premium increases are likely to keep inflation above the Reserve Bank’s preferred 3% band as is the case at present. 

“Both bonuses and salary increases are likely to be muted on the back of restrained economic growth, the poor performance of the global economy and tariff turbulence and geopolitical tensions that have not yet disappeared. People have to decide to purchase a home when it is financially the right time for them and that might not be the case right now. However, a cautious investor that is planning for the future is a good investor and one which the property sector should support,” Tyson suggests. 

He believes it is this investor who will ultimately benefit from the resumption of interest rate cuts by the middle of 2026 when inflation settles around the 3% mark and there is less stress on household disposable income. 

In light of this, Tyson advises both existing homeowners and those contemplating buying properties to keep sustainable investment top of mind. That could mean saving end of year bonuses towards a healthy deposit that will not only ensure a pre-approved bond and good rates from financiers but also ensure that bond repayments are compatible with overall household spending. 

As interest rates settle into a short-term holding pattern, Tyson also advises that people closely review unnecessary expenses such as unused data contracts or subscriptions: “Make sure that any increases in insurance premiums take into account any depreciation in assets and shop around for comparative packages that might save money. In short, it is a good idea to find those small potential savings in multiple areas that add up to a larger sum that paves the way for a comfortable bond repayment on a property asset that will appreciate.”

Most importantly, Tyson is confident that further interest rate cuts will make property even more affordable in 2026. He encourages those that are considering buying their first apartment or home to begin shopping: “Start talking to a property professional. At Tyson Properties we have a team that will guide both new buyers and second timers who are looking to spread their wings taking into account the challenges within the current business climate,” he concludes.