South Africa has taken a cautious approach to monetary policy, opting to hold its benchmark interest rate at 6.75%, amid easing inflation risks and a firmer currency. This pause, the first since September 2025, marks a shift in the central bank’s strategy as global uncertainty persists.

The South African Reserve Bank (SARB)’s Monetary Policy Committee (MPC) voted 4–2 in favor of maintaining rates, with two members advocating a 25-basis-point cut. The decision follows cumulative reductions of 100 basis points over the past year, which brought the policy rate down from 7.75% to 6.75%.

Governor Lesetja Kganyago noted that the near-term inflation forecast has softened due to a stronger rand and lower oil price assumptions. December’s 3.6% inflation print may represent the peak for the year, although food and electricity prices remain potential upside risks. The central bank also revised its 2026 inflation projection to 3.3%, edging closer to its 3% target anchor within the 3–6% target band.

“Global volatility continues to challenge our outlook,” Kganyago said, citing geopolitical tensions and oil price fluctuations as key uncertainties. He highlighted that while South Africa has paused its easing cycle, other African economies are pursuing different approaches.

For instance, Angola cut its benchmark rate by 100 basis points to 17.5% in January, reflecting improving domestic conditions and easing inflation. Ghana surprised markets with a 250-basis-point cut to 15.5%, the lowest since February 2022. Tanzania, meanwhile, held its policy rate at 5.75% to sustain economic growth.

In Nigeria, analysts anticipate a gradual shift toward rate easing at the next Monetary Policy Committee meeting in February. Last September, the central bank cut its policy rate by 50 basis points to 27%—the first reduction in five years—but has since maintained a cautious hold.

The current environment underscores a broader trend in Africa, where central banks balance domestic inflation control with global financial shocks. The SARB’s approach emphasizes careful monitoring of inflation drivers and currency movements, aiming to stabilize the economy while maintaining investor confidence.

SARB’s decision also reflects the growing complexity of monetary policy in a globally interconnected market. With renewed foreign investor interest in South Africa and neighboring countries, the central bank’s cautious stance seeks to ensure that domestic stability is not compromised by external shocks.

As 2026 progresses, policymakers across the continent are expected to navigate a delicate balance between stimulating growth, controlling inflation, and maintaining financial market stability. South Africa’s measured approach signals that monetary policy will remain responsive but prudent, prioritizing long-term economic resilience over short-term gains.

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The new law, designed to bring structure, fairness, and transparency to the fast-growing industry, is now in its final stages, with government approval expected soon.

For years, Tanzania’s real estate market has operated with minimal oversight, creating a landscape where overpricing, fraudulent practices, and limited data have made transactions unpredictable. The new law aims to change that by establishing a clear regulatory framework that benefits all stakeholders, from buyers and developers to investors and policymakers. With an annual housing demand of 200,000 units and an overall deficit of 3 million homes, the urgency for reform has never been greater.

Upendo Matotola, Director of Real Estate at the Ministry, emphasized the necessity of these changes. She explained that a structured approach is essential to ensure that both local and foreign investors can engage in the market with confidence. A major focus of the reform is pricing transparency, a crucial step in preventing artificial inflation and market instability. Matotola pointed out that an efficient regulatory system would provide accurate data on property values, ensuring that buyers and sellers operate within a fair and predictable system.

Recognizing the need for modernization, the government has also been working on digitizing property records, a move expected to enhance accessibility and reduce corruption. The introduction of digital platforms will give the public direct access to verified property information, allowing them to make informed decisions without falling victim to misinformation or fraud.

Industry leaders have expressed strong support for the reforms. Fred Msemwa, CEO of Watumishi Housing Investment, described the legal changes as overdue and necessary for sustainable growth. He stressed that while the sector has expanded rapidly, it has lacked the structure needed to ensure long-term stability. However, he suggested that instead of focusing solely on regulation, the government should consider forming a development authority that would actively promote growth and investment in the sector.

Hamad Abdallah, Director General of the National Housing Corporation (NHC), echoed similar sentiments, emphasizing that without proper governance, the industry cannot reach its full potential. He noted that clear laws will not only protect investors but also improve the quality of housing projects and encourage responsible development.

The absence of strong regulations has long allowed loopholes that some industry players have exploited, leading to a loss of trust among consumers and investors. Matotola acknowledged that unscrupulous practices have thrived in this environment, reinforcing the need for a legal framework that safeguards the interests of all participants.

As Tanzania finalizes this major reform, expectations are high that the new law will usher in a more stable, transparent, and investor-friendly real estate market. By addressing long-standing issues and implementing digital solutions, the country is positioning itself as a regional leader in structured property development. If executed effectively, these changes could unlock new opportunities for economic growth while ensuring that homeownership remains accessible and fair for all Tanzanians.

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A number of key developers – mainly public institutions – are involved in the construction and selling of low-cost houses. National Housing Corporation (NHC), Watumishi Housing Investment (WHI) and pension funds are currently implementing projects in various areas, with public interest in low-cost homes said to be growing steadily.

However, the last few years have seen prices of important building Prof Mkenda reveals plans to overhaul libraries services News 2 hours ago materials such as cement, steel bars, paints, gypsum, gravel, aluminium, tiles and glass rise sharply. The situation is associated with inflationary pressure caused by multiple factors, including global financial instability, which has pushed up prices of imported building materials such as steel, tiles and aluminium. WHI chief executive Fred Msemwa said the firm was facing challenges in delivering affordable homes as prices of building materials have kept on rising in the past few years, making it difficult to build houses that were affordable to ordinary home buyers.

He cited as an example cement prices, which have jumped from between Sh12,000 and Sh14,000 per 50-kilogramme bag to between Sh17,000 and Sh20,000, depending on the location. Prices of steel bars have also risen from around Sh1.8 million per tonne to Sh2.4 million during the same period.

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“It is a tricky situation because we know the income profile of our customers,” Dr Msemwa said. WHI builds houses whose prices range from Sh45 million to Sh87 million and the units are being snapped up, but that could soon change as prices and the units are being snapped up, but that could soon change as prices of building materials soar. “The challenge is how to align the incomes of our customers with rising house prices,” Dr Msemwa added. He said WHI was using its own construction company to build houses in an attempt to reduce costs. “We have also come up with more flexible payment schemes that align with the incomes of public servants.”

NHC public affairs and information manager Muungano Saguya said the cost of affordable houses was affected by various factors, including rising prices of construction materials, infrastructure, VAT and the cost of land. He acknowledged the challenges posed by rising prices of building materials, but said NHC continues to build low-cost houses. Mr Saguya added that NHC was currently studying various construction methods and models that would ensure that house prices do not spiral out of control. “Last year, we went to Kenya to learn about a new construction method known as the ‘tunnel form’, which has been used in that country to build houses that are affordable, attractive and durable. We want to start educating the public that it is not a must, for example, that houses should be built using traditional cement bricks.”

Mr Saguya said NHC was also finalizing discussions with manufacturers of construction materials, including iron sheets, tiles and cement, so that the firm could buy them in bulk under long-term agreements. He thanked the government for removing VAT on the sale of houses whose prices do not exceed Sh50 million. “We now urge the government to consider reducing some taxes on imported construction materials to address the price issue.”

The assistant director for housing and property development in the Ministry of Lands, Housing and Human Settlements Developments, Mr Awadhi Salim, said various strategies were in place to sustain the construction of affordable houses in Tanzania. They include formulating guidelines that help people to minimise costs when building homes.

“The guidelines are available in Kiswahili and English and they advise members of the public on how to significantly reduce construction costs,” Mr Salim said.

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He added that the ministry was also partnering with other institutions to provide mortgages at pocket-friendly interest rates. Industry and Trade permanent secretary Hashil Abdallah said stakeholders should submit a formal request for a reduction of VAT on construction materials. “We are always ready.

They need to bring us their suggestions and we will check whether they are realistic and work on them swiftly. Her Excellency President Samia Suluhu Hassan wants to see a better life for all Tanzanians and we cannot be an obstacle,” he said. Experts offer views Tanzania is estimated to have a shortage of 3.8 million houses, with demand increasing by 380,000 units annually, according to NHC. Experts have urged the government to remove VAT on imported construction materials and developers to research on alternative bricks and enter into long-term contracts with suppliers. A lecturer at Ardhi University, Dr Maulid Banyani, said developers and the government need to work together to address spiralling costs. “There are developers who are compelled to import some materials because they are not readily available locally. The government should think about how it can help,” he said.

He added that the government should also formulate a housing policy that will give a clear definition of “affordable housing”.

An independent real estate expert, Dr Felician Komu, said it was unlikely that prices of building materials would come down in the near future, adding that innovators should come up with alternative ways of building affordable houses.

“Developers can start by using building materials that are made with simple materials to reduce overall costs.

Using bricks made by developers themselves instead of buying them from suppliers can help,” he said.

Source: The Citizen

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