When we read about bank assets, inflation and economic growth, it can feel far removed from showing a house or negotiating an offer. Yet these figures help explain the conditions in which buyers make decisions and banks assess home loans.
In this October edition, we unpack economic commentary by Dr Roelof Botha on three themes: growth in bank assets, rising average homebuyer incomes and strong vehicle sales. There are encouraging signs for property, although renewed interest rate pressure means affordability still needs careful attention.
Stronger banks and the role of property finance
Dr Botha reports that South Africa’s banking assets reached R9.21 trillion at the end of the second quarter of 2026, up 9.1% on a year earlier. PwC’s September 2026 Major Banks Analysis also records a 9.3% increase in combined headline earnings to R82.3 billion for the first half of the year.
Bank assets include loans and other financial holdings. Their growth gives us a sense of the scale of banking activity, while earnings help us understand the sector’s financial performance.
For property, a financially sound banking sector matters because home loans support so many purchases. Buyers need lenders able to assess applications and fund transactions. Stronger bank results do not, however, guarantee easier approvals or tell us how much a particular bank wants to lend in a particular market.
Each application still depends on the buyer’s income, expenses, debt commitments and credit history, together with the property being purchased. For estate agents, the practical lesson is to establish affordability early. A buyer’s enthusiasm becomes much more useful when there is a clear route to finance.
Rising buyer incomes and real affordability
Dr Botha highlights rising average homebuyer incomes in BetterBond’s data. This is encouraging because income is one of the main building blocks of affordability. Where earnings rise and other commitments remain manageable, a buyer may have more room for a home loan repayment.
These figures describe the buyers recorded in that dataset. They do not mean every South African household is earning more, and a change in the mix of buyers can also affect the average.
A higher salary alone does not necessarily translate into a larger bond. Transport, food, school fees and existing debt can absorb the increase. What matters is the relationship between income, expenses and the proposed repayment.
That is why an affordability assessment is more useful than estimating a purchase price from salary alone. Agents should also encourage buyers to update their prequalification when circumstances change. A salary increase, a settled debt or a new credit agreement could change their buying position.
Interest rates and the monthly budget
Dr Botha explains how the earlier rate-cutting cycle helped ease debt servicing costs and supported activity. More recently, borrowing conditions have tightened again. The Reserve Bank increased the repo rate to 7.25%, effective from 25 September 2026, with prime moving to 10.75%.
When the rate on a variable-rate home loan rises, the monthly repayment generally rises too. Existing homeowners need to adjust their budgets, while new buyers may find that the same monthly budget supports a smaller loan.
The connection to inflation is practical. Higher fuel prices can increase transport and business costs, adding pressure to prices more broadly. The Reserve Bank has identified global supply disruptions and renewed inflation pressure as reasons for its latest increase.
Dr Botha sees scope for inflation and rates to ease if international disruptions subside. This is an outlook, rather than a certainty. The Reserve Bank’s forecast also allows for cuts later, but future decisions will depend on the data and risks at the time.
For buyers, the sensible starting point is today’s repayment, with breathing room for other costs. A purchase needs to be manageable without relying on a future rate cut. For agents, current affordability assessments help keep expectations realistic when negotiating offers.
What vehicle sales tell us about property
Dr Botha’s commentary also highlights strong vehicle sales compared with growth in the wider economy. He links this partly to earlier reductions in borrowing costs and the availability of relatively affordable imported vehicles.
Cars and homes are both substantial purchases that are often financed through credit. Vehicle sales can offer clues about spending activity, but they are not a direct forecast of property demand. Prices, imported models and the mix of purchasers can influence car sales independently of the housing market.
At an individual level, the connection is much more direct: a new vehicle repayment adds another monthly commitment. Buyers planning a home purchase should understand how taking on that debt could affect their bond affordability.
For agents, it is worth checking whether anything has changed since a buyer was last prequalified. Their salary might be the same, while the amount available for a home loan has changed significantly.
What this means for property in October
Dr Botha’s analysis gives us reasons for encouragement, alongside reasons to remain practical. Strong banking results support confidence in the financial system, and rising recorded homebuyer incomes may help some purchasers move forward. Renewed interest rate pressure means buyers still need to examine their budgets carefully.
National figures provide context. Local demand, realistic pricing, a property’s condition and the buyer’s finances still determine how an individual transaction progresses.
For estate agents, understanding the economy helps make conversations with buyers and sellers more useful. Has the buyer’s budget changed? Can they comfortably afford the repayment? Is the asking price aligned with the buyers active in this market?
At Phoenix Bonds, we help connect those questions to the finance by assessing affordability, preparing applications and comparing available bank offers. Getting the buyer’s financial position clear early gives everyone a firmer basis for moving the sale forward.