Growth in the value of outstanding credit balances in the South African household sector (R1 669,6 billion) was only slightly higher at 6,1% year-on-year (y/y) at the end of May 2019 from 6% y/y at end-April when outstanding balances came to R1 660,9 billion. Growth in the value of outstanding household mortgage balances (R974,9 billion and 77,3% of total household secured credit balances and 67,7% of total private sector mortgage balances) came to 4,2% y/y at end-May, which was up from 4,0% y/y at end-April.
Based on current trends in and the short term outlook for the economy, household finances and consumer confidence, growth in household credit balances, including mortgage balances, is expected to remain in the rest of the year around levels seen in the first few months of the year. However, an expected cut of 25 basis points in lending rates at the next Monetary Policy Committee meeting in July will underpin the residential property market and the demand for and growth in mortgage finance.
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