Mortgages In South Africa

Find out everything you need to know to get a mortgage in South Africa

Home Overseas Mortgages Mortgages In South Africa
Pete Mugleston

Author: Pete Mugleston

Mortgage Advisor, MD

Updated: April 8, 2024

House prices in South Africa are relatively low compared with those in Western Europe, making it an attractive place to buy a home or investment property. So, if you’re considering buying property in Cape Town as a foreigner, it may be more affordable than you think.

In this article we’ll explain how overseas mortgages in South Africa work, the eligibility criteria and why you should speak to a specialist broker as soon as you decide to buy property there.

Can a UK resident get a mortgage to buy a property in South Africa?

Yes. There are no real restrictions on foreigners buying property in South Africa – although you may struggle if you have a criminal record.

The South African mortgage market is a mature one and you will probably notice several similarities with financial transactions in the UK. But there are some key differences you need to be aware of too.

For example, the terminology differs. In South Africa, mortgages are often referred to as ‘bonds’, a mortgage provider is an ‘originator’ and a leasehold is called a ‘sectional title’.

And it’s worth noting that every mortgage for a non-resident must be approved by the South African Reserve Bank before it can be completed.

Maximise your chance of approval with a specialist

Eligibility criteria and deposit requirements

One of the first things you need to do if you intend to buy property in South Africa is to open a bank account in the country. This will be necessary for making your mortgage repayments as well as paying bills and taxes.

And the way in which South African mortgages are assessed differs greatly from what you might be used to in the UK.


While affordability is still a vital factor, South African lenders tend to focus on your debt to income (DTI) ratio rather than using income multiples.

Typically, your DTI (including the cost of your mortgage repayments) should be no more than 33% – 35% of your monthly income. Some lenders are more flexible than others on this so, if the numbers are tight, finding the right provider can be the difference between acceptance and rejection.

Try our calculator below to see how this could work out for you:

Debt to Income Ratio Calculator

This calculator allows you to calculate your debt-to-income ratio and will indicate whether mortgage lenders will classify it as low, medium, or high risk.

The amount you get paid each month, after any taxes or contributions have been deducted
Be sure to include all of your fixed outgoings, as well as any loans or credit card payments you make

Your Results:

Your Debt to Income Ratio is %

Good news! Most mortgage lenders will class your debt-to-income ratio as low. You’re unlikely to be declined for a mortgage based on your outgoings, but speaking to a mortgage broker before applying is still recommended as they can improve your chances of getting the best deal.

Most mortgage lenders will class your debt-to-income ratio as moderate, which means some of them might view your application with caution. Some lenders are much more strict than others when it comes to affordability and debt, so it’s important for you to find a lender who’s more lenient. You should speak to a mortgage broker before you apply to ensure you’re matched with a lender whose criteria you fit.

Most mortgage lenders will class your debt-to-income ratio as high. But that’s where we can help! With so much of your monthly income going towards debt repayments, you could struggle to get approved for a mortgage without the help of a mortgage broker. We can help you find a lender who’s more lenient on debt and affordability, and could still secure a mortgage approval.

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Credit history

A clean credit history is always more attractive to lenders regardless of location.

All mortgage providers will assess credit history according to their own criteria. Some will accept your UK bank statements or other financial documents as evidence of how you handle your finances. Others will insist on an international credit report.

You can check your credit history for free by heading to our credit reports hub and accessing a free trial on there.


Mortgages in South Africa typically need to be paid off by the age of seventy. The usual term for a mortgage in the country is twenty years, but terms of up to thirty years are possible. Older borrowers may only be able to borrow over a limited term, however.


As a non-resident, you will usually need to have a deposit of 50% to secure a mortgage in South Africa. 10% of this will typically be paid up front to secure the property, with the rest payable on completion.

If you have lived in the country for five years or more, or if you have the right to work in South Africa, you will have similar rights to native South Africans when it comes to mortgages. This might enable you to get a mortgage at 75% loan to value (LTV).

How to get a mortgage in South Africa

Working out how much you can borrow is just the first step in getting a mortgage in South Africa.

In order to complete your mortgage, you will need to meet lenders’ eligibility criteria, provide necessary documents and pay a series of fees.

Follow these steps to give yourself the best chance of approval:

Get your documentation together

Even a straightforward application can take up to eight weeks to complete, so the sooner you get all your documents together, the quicker you can get on with finding and buying a property.

The exact documentation required may vary from one lender to the next but will typically include:

  • Passport or ID card
  • Proof of address
  • Proof of legal residence or work permit for South Africa (if applicable)
  • Last three months’ payslips
  • Two years of audited accounts (if self-employed)
  • Last three months’ bank statements
  • International credit check (if requested by lender)
  • South African Reserve Bank certificate

When buying from overseas, some of these documents may need to be notarised in order to be acceptable to South African mortgage lenders.

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How much can you borrow?

As you can see from the information above, your borrowing capacity for a South African mortgage is often limited to 50% of the property value and largely dependent on your income and expenses.

Which lenders offer South African mortgages

To get a mortgage to buy property in South Africa, you must use a registered South African bank.

Some of the major banks include:

  • Standard Bank: The biggest bank in the country – has a range of products (including mortgages) tailored to non-residents.
  • Absa: A subsidiary of Barclays that has products and services aimed at the expat market.
  • First National Bank (FNB): Has a ‘Foreign Choice’ mortgage product targeted at overseas buyers.

Which is best for you?

Deciding which lender and product are right for you requires deep knowledge of the market and the specific terms and conditions associated with each mortgage type.

Unlike in the UK, fixed rates are uncommon in South Africa. This is because banks are wary of volatile interest rates so don’t usually offer competitive rates on fixed term mortgages. Where fixed terms are available, they usually last for five years.

Variable rates are far more common and usually come in at around 10% for locals – sometimes even higher for non-residents. These are still considered affordable and relatively stable for UK borrowers as the pound has traditionally been strong against the rand.

Some lenders offer Prime Minus loans which are similar to discounted variable rate mortgages in the UK.

Get matched with a broker who specialises in South African mortgages

South African properties are sold ‘voetstoots’ (as is), so it’s vital that you make sure everything is checked and double-checked before signing your loan agreement.

There are also local regulations in some areas that must be complied with. For example, some regions require gas and plumbing certificates, while others only insist on electric certificates. In some coastal regions, you must obtain evidence the property is not infested with beetles.

When you add these elements to the standard stresses of taking out a mortgage, it’s easy to see why expert help is necessary for a hassle-free application.

Our broker matching service will assess your situation and pair you up with an expert advisor who has experience of helping people in your situation to secure the best mortgage for property in South Africa.

To get matched with your ideal broker, call today on 0808 189 2301 or enquire online.


Yes. You can buy property to let out as a home or holiday rental. And this can be a very lucrative investment as South Africa is a popular holiday destination. There are also tax reliefs available on some of the costs of managing a buy-to-let. Your broker can talk you through these.

Some do, but most don’t. This means you’re free to make additional payments when interest rates are low to reduce your overall cost of borrowing.

No. While non-residents are free to buy homes and commercial properties, the Land Holdings Bill restricts the purchase of farmland.

Maximise your chance of approval with a specialist

About the author

Pete, an expert in all things mortgages, cut his teeth right in the middle of the credit crunch. With plenty of people needing help and few mortgage providers lending, Pete found great success in going the extra mile to find mortgages for people whom many others considered lost causes. The experience he gained, coupled with his love of helping people reach their goals, led him to establish Online Mortgage Advisor, with one clear vision – to help as many customers as possible get the right advice, regardless of need or background.

Pete’s presence in the industry as the ‘go-to’ for specialist finance continues to grow, and he is regularly cited in and writes for both local and national press, as well as trade publications, with a regular column in Mortgage Introducer and being the exclusive mortgage expert for LOVEMoney. Pete also writes for Online Mortgage Advisor of course!

Read more about Pete

Pete Mugleston

Mortgage Advisor, MD

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