How much bond can I afford? A simple guide to instalments, interest and deposits

Banks generally allow a bond instalment of up to about 30% of your gross monthly income, after checking your other debts and living expenses. Working backwards from that number tells you your realistic purchase price.

The rule of thumb

At the current prime lending rate over 20 years, every R100 000 borrowed costs roughly R1 000 per month. A R1 000 000 bond is therefore around R10 000 per month; a R1 500 000 bond around R15 000. Use our bond calculator to test different interest rates, deposits and terms.

Deposits change everything

A 10% deposit on a R1 000 000 home lowers the instalment by about R1 000 per month and often earns a better interest rate. If you can wait six months to save a deposit, it is usually worth it.

Interest rate matters more than you think

A 1% difference in your rate on a R1 000 000 bond is roughly R650 per month – over R150 000 across the loan. That is why we recommend applying through a bond originator who submits to several banks at once.

Try the bond calculator on this site, then contact us for a pre-qualification.