These are the homes you can afford to buy with your salary in South Africa

Data analytics group Lightstone has released a new report on the suburbs and homes you can afford to live in – based on your salary.

According to Standard Bank’s latest house price index stand-alone properties have continued to outperform townhouses and flats in 2018, with the price of the median free-standing home climbing 7.6% year-on-year in April, versus 6.9% year-on-year in March to R1,049,200.

By contrast, house price growth for flats and townhouses remained relatively flat at 5.8% year-on-year in April, with a median price of R874,700.

Based on Lightstone’s data, this means you should be earning in the region of R35,000 to R39,000 a month to afford the average R1 million free-standing home in South Africa right now, and if you were looking to buy a R874,000 townhouse you should be earning in the region of R26,000 – R30,000.

The table below shows how much you could spend on a home based on your monthly salary – as well as examples of suburbs with these median house prices.

The data is based on current house prices (May 2018), factoring in the recent rate cut, and assumes a 0% deposit (but excludes additional fees incurred during the inception of the loan or transfer of property into the calculation.)

Pricing is based on:

• The assumption that people are not going to spend more than 30% on servicing a home loan.
• The assumption of a 0% deposit for both home financing (but excluding added additional fees incurred during the inception of the loan or transfer of property into the calculation).
• The assumption that the homes are financed over 20 years at the prime lending rate.

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