If you’re applying for a joint bond with a spouse, the percentage of your salary devoted to the home loan repayments can be a little higher, as you’ll both presumably be pooling your resources to cover living expenses. This makes it a good time to buy property. Thankfully, South Africa’s interest rates are currently at record lows, due to a succession of interest rate cuts in 2020.

You should still keep the 30% rate in your mind when searching for a property you can afford, but the interest rate obviously will play a role in your decision making. Of course, other factors will come into play, such as: Interest ratesĪ lower interest rate means you’ll be able to spend a slightly lower percentage of your salary. Anything above that, and you are entering risky territory.ģ0% has been settled upon as the safe number because it leaves lots of room for living expenses, and it is a realistic amount to set aside for a home loan. The percentage of your salary required for the home loanĪs a rule of thumb, you should expect about 30% of your monthly income to be used for bond repayments. Performing this calculation will give you an idea of how close you are to making the dream of home ownership a reality. Of course, this number must take into account monthly living expenses, income, and the current interest rates. But another critical question would be: What proportion of your salary should you be spending on the monthly repayments for that home loan? Research from Lightstone property showed the minimum salary for buying a home to be around R20 000 (assuming a 20 year repayment term).

There are a range of tools that can help you determine your bond affordability, such as the ooba Home Loans Bond Calculator.

This could change depending on interest rates, and whether you are applying for joint bond ownership with a spouse.

As a rule of thumb, you should be setting aside 30% of your salary for the home loan repayments.

How much should i pay tor house