The South African Reserve Bank's Monetary Policy Committee has announced its decision not to change the repo rate. The question now becomes what the decision bodes for the slumped property market?

It comes as no surprise that the South African Reserve Bank's Monetary Policy Committee today opted to make no changes to the interest rate which will remain at 5.5 %. All indications are that the nation's debt ratio is still much too high; with household debt to annual income sitting at a hefty 78.4% and, bearing this in mind, it is hardly surprising that the Monetary Policy Committee isn't encouraging consumer spending.

It is true that these figures are certainly not as alarming as America's $7,800 consumer debt per person (as indicated in the Business Insider), nor the UK's current situation where, according to John Davies from Credit Action, "individuals owe nearly as much as the entire country produced in the four quarters between Q2 2010 and Q1 2011". While the South African figures might pale in comparison to those of our northern neighbours' they are by no means a welcome sight.

As such any decision to raise the repo rate would almost certainly reflect negatively on local wallets and, of course, home loan applications. The property market has been valiantly crawling along for months and needs no further discouragement. CEO of Leapfrog Properties, Jan le Roux, concurs with the sentiment: "we are relieved that the rate stayed the same as a struggling property market can hardly cope with higher interest rates".

Le Roux goes further to indicate that "the real problem restricting growth in the property market is however the availability of finance, not just the interest rate". Research released by Absa Property Research supports this view stating that low economic growth, pressure on employment and consumer price inflation above 5%, amongst other factors, support a nominal house price growth within single digits for the remainder of 2011. ABSA's November House Price Indices predicts improved growth for 2012 but remains doubtful that it will exceed the five percent mark.

Arguably a decrease in the repo rate would give consumers and lenders a little more breathing room but is not a viable solution at present due to the uncomfortably high level of consumer debt currently being evidenced.

It would seem that maintaining the status quo is the way ahead for the moment. That might not be what consumers or house sellers were hoping for but might just encourage buyers to venture out.