The short answer: At 10.75% over 20 years, every R100,000 you borrow costs about R1,015 a month. A common rule of thumb is to keep the bond repayment at or below roughly 30% of your gross monthly income, which for a R1.2 million bond means an income of about R40,600. Banks run their own affordability checks, so treat this as a guide and not as a promise of approval.
Most people work out what home they like and then ask what it costs. It works better the other way round: start with what you can carry each month, then see which price that supports. This guide shows the numbers.
How much will the bond cost each month?
The Reserve Bank raised the repo rate by 25 basis points to 7.25% in September 2026 (effective 25 September), which took prime to 10.75%. The next rate decision is due on 19 November 2026, so the rate can still move before you sign anything. Bond rates differ by bank and by your credit profile, so 10.75% here is for illustration. These are the monthly repayments over 20 years at 10.75%:
- R800,000 bond: R8,122 a month
- R1,000,000 bond: R10,152 a month
- R1,200,000 bond: R12,183 a month
- R1,500,000 bond: R15,228 a month
A longer term lowers the repayment but raises the total interest. On R1.2 million over 20 years at 10.75% you would pay about R1.72 million in interest on top of the loan. Over 30 years the repayment falls to R11,202 a month, but the interest bill is much larger.
What income does that need?
A common rule of thumb is that the bond repayment should be no more than about 30% of your gross monthly income. Dividing each repayment above by 0.30 gives the income it needs:
- R8,122 a month: about R27,073 gross
- R10,152 a month: about R33,841 gross
- R12,183 a month: about R40,609 gross
- R15,228 a month: about R50,761 gross
This is only a guide. Banks look at your income, your other debts and your living costs, and a car instalment or store account lowers what you can borrow. Your credit score also affects the rate you are offered, and car finance is one of the debts that counts.
What happens if rates rise?
A bond is a long commitment, and the rate can move. A rise of 1 percentage point, from 10.75% to 11.75%, adds these amounts to a 20-year repayment: R548 a month on R800,000, R685 on R1,000,000, R822 on R1,200,000 and R1,027 on R1,500,000. If your budget cannot absorb that, the bond is bigger than it should be.
The law caps what a lender can charge on a mortgage at the repo rate plus 12%, which is 19.25% at today's repo rate, but you should plan for far less than the cap. A useful test is to work out your repayment at one or two points above today's rate and check that the budget still works.
What costs come on top of the bond?
- Deposit. The house deposit guide sets out how to build one.
- Transfer costs. Transfer duty is a SARS tax, and on the current table there is none on the first R1,210,000 of the price. Above that it is 3% of the amount over R1,210,000, up to R1,663,800, and then R13,614 plus 6% of the amount over R1,663,800. On a R1.5 million home the duty is R8,700, and on R1.8 million it is R21,786. Attorneys also charge fees for the transfer and the bond registration, so ask for a quote.
- Rates and taxes, and levies if you buy in a complex.
- Home insurance and maintenance. Many owners set aside about 1% of the home's value a year for repairs, which is a rule of thumb and not a rule.
How do you test affordability before you apply?
Run a practice year. Take the bond repayment you are considering and add a figure for rates, insurance and maintenance. Say the bond is R10,152 and the extras are R2,000, so the home costs R12,152 a month, and you currently pay R6,500 rent. The difference is R5,652 a month. Move that amount into a separate savings account for three to six months. If you manage it without stress, you have real evidence. If you struggle, you have learned that cheaply.
It also helps to look at the trade-off honestly. The comparison of saving as a renter and as a homeowner and the guide on how much of your income should go to rent give you the other side of the sum.
What should you do before you apply?
Get your credit report and fix any errors, because they can affect the rate you are offered. Clear small debts and store accounts that reduce what you can borrow. Save the deposit and the transfer costs, and keep some cash aside for moving and furnishing. Then compare offers from more than one lender, because rates and conditions differ between banks, and ask each what rate they would give you based on your profile. A pre-approval tells you the price range a bank is likely to lend on, which is more useful than guessing.
How can Budget Hub help?
Budget Hub lets you enter your income and expenses and see your real monthly surplus. That surplus, not the listing price, is the starting point. Create a savings goal for the deposit, and a second for the practice-year amount, and track each contribution. The free plan includes up to three savings goals.
Quick answers
How much of my salary should go to a bond?
A common rule of thumb is no more than about 30% of gross income, though banks run their own assessment and your other debts change the answer.
How much deposit do you need?
It varies by lender and profile. For scale, 10% of a R1.2 million home is R120,000, and a larger deposit lowers the bond and the monthly repayment.
Do you pay transfer duty when you buy a home?
Only on the part of the price above R1,210,000, on the current SARS table. A home at or below R1,210,000 carries no duty, and a R1.5 million home carries R8,700.
What does a 1 percentage point rise cost?
About R685 a month more on a R1,000,000 bond over 20 years, and about R822 more on R1,200,000.
Sources: SARB Monetary Policy Committee statement, September 2026, National Credit Regulations, Regulation 42 (Government Gazette 39379), SARS transfer duty. Rates, limits and thresholds change, so check the source for the current figure.
Do the monthly sum before the viewing, test it with a practice year, and leave room for rates to rise. A home you can afford in a hard month is worth more than a bigger one you can afford only in a good one.