Are banks approving fewer home loans in South Africa?
Not as a matter of policy. South African banks have not publicly tightened their approval criteria, and originator-reported approval ratios have stayed broadly steady. What has changed, per TransUnion's Q2 2026 Consumer Credit Industry Insights Report, is volume: new home loan originations fell 10.5% year-on-year, and the total number of mortgage accounts fell 4.6%. Fewer South Africans are coming to market for a bond in the first place — this is a demand shift, not evidence that banks are rejecting more applications.
Why did home loan originations fall if approval rates didn't?
Affordability is the most direct explanation. Prime has risen to 10.75% (SARB, effective 2026-09-25), which pushes up the instalment a given bond size requires and, under the NCA affordability rule, the gross income a bank needs to see before it will lend. At the same time, TransUnion reports the number of consumers carrying any mortgage balance fell 7.5% year-on-year. Buyers who would have qualified for a smaller bond a year or two ago are the ones most likely to be priced out of applying at all — they haven't been declined; many simply aren't in the market.
Who is still getting a home loan right now?
Higher-income borrowers, largely. TransUnion's data shows total outstanding mortgage balances actually rose 4.6% year-on-year even as the number of accounts fell, and the average mortgage balance climbed 9.6%. TransUnion attributes this to mortgage activity concentrating among prime and above-prime consumers — borrowers able to afford larger properties — while participation from lower-income, typically first-time-buyer tiers has eased. The home loan market isn't shrinking so much as it is re-weighting toward buyers who can absorb today's rate environment.
How much income do you need to qualify for a home loan at today's rates?
Here is bond.co.za's own calculation, using the standard South African annuity formula and the National Credit Act affordability guideline banks apply — that a home loan instalment should not exceed 30% of gross monthly income. These are illustrative bond sizes at today's 10.75% prime rate over a 20-year term, not a quote for any individual application:
| Bond size | Monthly instalment at 10.75% | Gross income needed (30% rule) |
|---|---|---|
| R 900 000 | R 9 137 | R 30 457 |
| R 1 500 000 | R 15 228 | R 50 761 |
| R 2 500 000 | R 25 381 | R 84 602 |
This is a floor, not a full picture: banks also weigh existing debt, credit record, deposit size and the specific property before approving a bond. To see where your own income and deposit place you, use the home loan affordability calculator.
What does this mean if you're a first-time buyer on an average salary?
It means comparison and preparation matter more than they did when rates were lower. A single bank's decline is not the market's verdict — different banks price the same application differently, and a bond originator can put one application in front of several banks at once. First-time buyers who qualify for a government subsidy should also check bond.co.za's first-time buyer guide for what First Home Finance and a clean application can add to what you qualify for. Getting a free pre-qualification check before you start viewing houses shows you a realistic number before a seller or an estate agent does.
What these figures don't tell you
TransUnion's report measures the market in aggregate — it does not say what any individual bank will do with any individual application. It also doesn't separate how much of the originations drop is buyers choosing to wait versus buyers who tried and didn't proceed. The gross-income figures above assume a buyer's only debt obligation is the bond itself; existing credit card, vehicle or personal-loan repayments reduce how much income a bank will count toward a new bond. None of these numbers are a guarantee of approval, a rate, or a specific borrowing limit for any individual buyer.
(Last updated 8 October 2026. Prime rate figure verified against the SARB September 2026 MPC statement. The TransUnion Q2 2026 mortgage-market figures are TransUnion's own reported data, not a bond.co.za number — see Sources below.)