What two average South African salaries can buy: a R1.5m home loan, and little room to spare
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Two South Africans on the average take-home pay could qualify for a bond of about R1.5 million, just under what first-time buyers typically pay, but servicing it would consume more than a third of their combined household income, a new analysis shows.
Two South Africans each earning the average salary could, on paper, afford something remarkably close to the average home being bought by first-time buyers. But qualifying for the bond and comfortably living with it are two different things, according to an analysis of pay and lending data.
The average South African salary earner took home R21,642 in July, according to the PayInc Net Salary Index, which tracks the take-home pay of about 2.1 million salary earners. Put two average earners together and R43,284 lands in their household each month.
PayInc head of stakeholder engagement Shergeran Naidoo said the average nominal net salary was 0.2% higher than in June and 2.2% above a year earlier, though salary growth has slowed: nominal net salaries rose only 1.6% in the first seven months of this year, against 3.7% during 2025. Independent economist Elize Kruger said that while the continued increase in nominal net salaries is encouraging, the broader picture shows salary growth remains subdued.
Banks generally cap monthly home-loan repayments at around 30% of gross monthly income. Working back from R21,642 in take-home pay, and using the 2026/27 tax tables with rebates and the employee UIF contribution, an employee would need to earn roughly R25,000 a month before tax. Two such salaries give gross household earnings of about R50,000, allowing around R15,000 a month for a home loan repayment.
At the current 10.5% prime lending rate and assuming a 20-year loan at prime, that would support a bond of about R1.5 million. BetterBond puts the average purchase price for a first-time buyer at R1.4 million, up 19% since the third quarter of 2023. BetterBond's home-loan approval ratio reached 64.5% at the end of August, and applications are 11.3% higher than in the fourth quarter of 2023, although the prime rate rose from 10.25% to 10.5% in May.
Once the repayment leaves the account, the picture tightens. A roughly R15,000 repayment would absorb about 35% of the couple's combined R43,284 take-home pay, leaving around R28,000 for rates and taxes, utilities, groceries, transport, insurance and other household costs, with a deposit possibly still to find. BetterBond says banks raised deposit requirements in the first two months of the third quarter, though average deposits remain 7.3% below their level two years ago.
Affordability has nonetheless improved for many buyers. For buyers aged 41 to 50, the average house-price-to-income ratio has fallen 27% since 2021 to 1.76, meaning the average property costs about 1.76 times their annual income. But house prices keep climbing: Statistics South Africa recorded annual residential property price inflation of 7.9% in April, including 11.2% in the Western Cape and 4.8% in Gauteng. PayInc's real net salary index rose for the first time in nine months in July as inflation eased, but real take-home pay remained 2.2% below its level a year earlier.