South African housing activity is mostly still at multiyear lows, but there’s been a rush of well-heeled buyers snapping up trophy properties in Cape Town.
A record 134 properties worth more than R20m have been sold in the city so far this year — up from 96 last year and comfortably ahead of the previous high of 120, which was recorded during the post-pandemic rebound in 2022. That’s according to the latest figures from Seeff Property Group and PropStats, an initiative of the Western Cape branch of the Institute of Estate Agents of South Africa.
In stark contrast, Joburg has recorded less than 10 sales of R20m-plus this year. Big-ticket sales in Cape Town have been bolstered by offshore investors looking to escape rising geopolitical tensions in Europe and the Middle East — and wanting to cash in on the weak rand.
But industry players say local buyers have also been active on the back of improved post-election sentiment, the continued absence of load-shedding and higher GDP growth prospects.
In what is believed to be the highest price paid for a house in South Africa this year, Pam Golding Properties (PGP) recently topped R90m (twice) in the old-moneyed southern suburbs enclave of Bishopscourt.
PGP CEO Andrew Golding tells the FM a UK buyer paid R93.3m for a seven-bedroom, modernist mansion on a sprawling 7,447m² erf, setting a new price record for the area. A Joburg buyer forked out an equally eye-watering R90m for a stately six-bedroom Bishopscourt home on a 5,965m² erf.
Earlier this year, PGP fetched R66m and R60m from two local buyers in Clifton and Camps Bay respectively, which Golding says underscores the strength of the city’s luxury housing market. “We are now seeing a shortage of stock in prime locations, which is placing pressure on pricing,” he says.
Ross Levin, licensee for Seeff Atlantic Seaboard and City Bowl, says the surge in luxury sales has pushed values to new highs.
Cape Town now has at least nine suburbs where the average house price equals or surpasses R15m: Clifton (R43m), Llandudno (R27m), Camps Bay (R21m), Higgovale (R20m), Bishopscourt (R19m), Constantia Upper (R18m), Bantry Bay (R17m), Fresnaye (R15m) and the V&A Waterfront (R15m).
Levin says Camps Bay, on the Atlantic seaboard, has been the most active top-end area in 2024, with more than 20 properties changing hands at R20m-plus. Four sales exceeded R50m: R68.25m (a Dutch buyer), R62.5m (Danish), R60m (South African) and R51m (Polish).
But wealthy buyers aren’t the only ones boosting Cape Town’s housing market. Industry players say there’s a stock shortage across several middle- to upper-income suburbs.
Sadly, the rest of the country’s residential property market is not so vibrant. Most households have been buckling under previous higher-for-longer interest rates and surging living costs.
In fact, national house prices have barely grown overall, despite lower interest rates since September. FNB’s house price index slowed to a measly 0.3% rise in October. That’s down from 1% in the first quarter. It’s the lowest growth since August 2009, when house prices dropped in nominal terms after the global financial crisis.
The FNB index has been deflating since May 2021, when it peaked at a multiyear high of 7.8%. At the time, a property mini-boom was supported by near 50-year-low interest rates.
The picture is now particularly grim in Joburg, where sales volumes and prices remain in the doldrums. As Jonathan Kohler, CEO of real estate group Landsdowne, puts it: “Joburg has seen virtually no capital appreciation since 2010.”
Stats SA figures show that Cape Town achieved an average 30% rise in house prices over the past five years, against Joburg’s 8.6%.
Granted, Cape Town’s outperformance is not unexpected, given its allure as a semigration hotspot. The trek to the Cape has been boosted by the remote working trend and perceptions that the DA-run metro is doing better at service delivery and infrastructure maintenance.
Still, there is hope that Joburg and other areas with muted housing activity are now poised for a rebound in 2025, with more rate cuts likely. Mortgage originators ooba and BetterBond report a 25%-30% year-on-year national increase in home loan applications in the past two months, with the most notable uptick in Gauteng.
The trend has been supported by a wave of bargain buying. “Gauteng is the property market to get into right now, as it offers the best value in the country across almost all price categories,” says Seeff chair Samuel Seeff. He expects Gauteng and other stagnant markets such as Gqeberha in the Eastern Cape, Mpumalanga and Limpopo to pick up next year.
However, Seeff says prices will start rising only when the oversupply of stock in these areas is reduced. Others agree that house prices won’t bounce back overnight, with the prime rate needing to drop at least another 100 basis points (bp) to kick-start activity. Even after two consecutive 25bp cuts, the prime lending rate is at 11.25%, way above the 7% low of 2020/2021.
Grant Smee, CEO of Only Realty Property Group, says areas such as Gauteng that have a high level of supply could take years to recover, despite signs of tentative recovery.
Meanwhile, the Cape Town market may run out of steam, as more would-be buyers are being priced out. Both Kohler and Smee warn that buy-to-let investors, in particular, need to be cautious.
Says Kohler: “The Cape Town market’s growth is not sustainable in the long term.” Smee also questions whether the city’s exuberance can last, especially on the Atlantic seaboard and in the city bowl, where buy-to-let investors have been most active. He says that with semigration seemingly tapering off and new Airbnb regulations coming into play, Cape Town’s boom could slow. Buyers will shift to areas with excess supply where they can exercise bargaining power.
Though the rest of South Africa appears poised for better days, it won’t be a blanket recovery.
There’s likely to be a notable disparity in the performance of various provinces, cities and suburbs. This will require homebuyers to become increasingly discerning about location, says Yael Geffen, CEO of Lew Geffen Sotheby’s International Realty.
Of course, suburb selection is often driven by personal circumstances such as stage of life, place of employment and affordability. But Geffen stresses that thorough research is the key to above-market capital growth. She recommends that buyers analyse the historical price trends of various suburbs. The trick is to find neighbourhoods where there’s already been a notable upswing and the potential for continued growth.
Look no further for suburb analysis than the FM’s annual top suburbs survey. It’s the 13th year we’ve partnered with research and analytics group Lightstone.
The survey ranks suburbs in the four major metros — Joburg, Cape Town, Tshwane and eThekwini — by growth in three average price categories: the middle market (R1.5m-R3m); the higher end (R3m-R5m); and the luxury market, where homes trade for more than R5m.
We’ve taken a five-year view, which we believe provides the most reliable picture of post-pandemic shifts in buying.
Notable trends in this year’s survey are:
- Cape Town’s top-performing suburbs saw prices rise at almost double the rate of those in Joburg, Tshwane and eThekwini;
- Price inflation is lower in the sub-R3m segment across the four major metros than in pricier neighbourhoods, suggesting that the lower- to middle-income segment’s household purchasing power has been hit hard by the rising cost of living;
- Demand continues to gain traction in access-controlled suburbs and golf and lifestyle estates, where homeowners’ associations take responsibility for maintaining roads and other communal property. This is on the back of poor municipal service delivery and ageing infrastructure in many ungated suburbs; and
- There’s still no end to the shift to coastal and countrified areas that offer a secure, family-friendly lifestyle with easy access to the great outdoors (beaches, greenbelts, hiking and biking trails), no doubt supported by the work-from-anywhere trend.
JOBURG
The city’s usual suspects have made way for new contenders. Smart gated estates such as Dainfern Valley, Dainfern Golf Estate and Eagle Canyon Golf Estate still count as sought-after addresses — but it’s the countrified mink-and-manure belt of Beaulieu on the outskirts of Kyalami that is now Joburg’s best-performing top-end suburb. Prices there typically exceed R5m, with overall price appreciation of 24% over five years. That’s well ahead of the rather uninspiring 15%-17% growth that most other winning suburbs managed.
What makes the gated community so desirable? Jade Eblen, area manager for PGP in Fourways and Midrand, says Beaulieu offers a haven for bird, nature and horse lovers. The area is believed to have the highest ratio of horses to owners in Africa. It’s crisscrossed by 20km of secure bridle trails, popular for outrides as well as for walking, jogging and mountain biking. Eblen says neighbouring Kyalami Country Club, with an 18-hole golf course and several padel courts, is another attraction.
There are two malls on Beaulieu’s doorstep — Kyalami Corner and Crowthorne Shopping Centre — and several private schools, including an equestrian academy. Large homesteads, on plots typically spanning more than 10,000m², are priced from R4m to R25m.
Joburg’s R3m-R5m category is dominated by gated estates on the city outskirts, including perennial outperformers Thornhill Estate near Modderfontein, Cedar Lakes in Broadacres and Fourways Gardens. All three are known for their community-centric approach.
David Ingle, licensee for Seeff Edenvale and Bedfordview, says Thornhill’s stellar price performance is bolstered by its abundant parks, greenbelts and children’s play areas. The estate also has easy access to golf, cycling and other outdoor activities. Buyers can choose between townhouses and standalone houses in the R2m-R5m bracket.
The Neighbourhood Estate, a secure upscale development in Linksfield, adjoining the Royal Johannesburg golf club and The Neighbourhood Square shopping centre, is another addition to the rankings. Charlene Leibman, area specialist for Lew Geffen Sotheby’s International Realty, tells the FM that The Neighbourhood is almost sold out.
The estate, which has a contemporary farmhouse architectural style, is centrally located. It is a 20-minute drive from OR Tambo International Airport and Joburg’s key business hubs of Rosebank, Melrose Arch and Sandton.
Joburg’s R1.5m-R3m category is dominated by established suburbs within the ring road, including Blairgowrie and Forest Town, that offer free-standing older homes.
Blairgowrie, where a sturdy four-bedroom house with a pool can still be had for less than R2.2m, leads the pack. Craig McIntyre, sales associate at Re/Max Advantage, says the suburb’s popularity is linked to its value proposition and proximity to major business centres, schools, shops, restaurants and Delta Park.
Forest Town’s attraction is its convenient location, as it borders Zoo Lake and the Johannesburg Zoo and lies between Jan Smuts Avenue and Oxford Road, with easy access to Rosebank, Wits University and Parkhurst’s range of vibey restaurants, cafés and bars.
CAPE TOWN
The rugged seaside hamlet of Scarborough, on the edge of the Cape Point Nature Reserve, has long been a magnet for surfers, hippies and tree-huggers. This year it pipped its posh Atlantic seaboard counterparts in the capital growth stakes. Scarborough, with only about 1,000 residents, is the overall best-performing suburb across all four major metros in the FM’s 2024 survey, with five-year price growth of 46%.
Jeremy Barnes, area manager for PGP South Peninsula, cites a relaxed coastal lifestyle and a strong sense of community as major attractions. He notes that the emergence of online grocery deliveries and remote working have upped Scarborough’s appeal for people to establish their primary homes there. Given the shortage of stock, expect to pay at least R6m for shabby-and-not-so-chic log cabins, and R10m-R16m for larger homes with sea views.
Barnes says that in the past parents who lived in the area had to homeschool their children, but there are now several other options, notably at the Imhoff Farm precinct in nearby Kommetjie — which also features among Cape Town’s top five best-performing higher-end suburbs. Kommetjie is known as one of the best surfing spots in the Western Cape and offers a laid-back lifestyle in an uncommercialised setting, yet it is still within an hour’s drive of central Cape Town.
Barnes says buyer demographics have changed dramatically over the past five years. Kommetjie traditionally had few full-time residents, with most owners using their properties only on weekends and holidays. There was no high school; Fish Hoek was the closest option.
However, the establishment of the Generations School and Waldorf at Imhoff Farm has put Kommetjie on the radar of more homebuyers. That has supported new development in the area — and, of course, pushed prices higher.
Camps Bay has replaced Melkbosstrand’s Atlantic Beach Golf Estate as Cape Town’s best-performing top-end suburb. Seeff’s Levin notes that Camps Bay is now the country’s second-most expensive area after Clifton. Besides being ever popular among locals, the suburb is also on the radar of buyers from Europe, China, the United Arab Emirates, Malaysia and Nigeria.
Apartment prices range from R5m to R40m-plus, while high-end homes with ocean views can fetch R35m-R95m. Buyers are lured by Camps Bay’s picturesque setting between mountain and sea, its famous blue flag beach fronted by a palm tree-lined promenade and upmarket eateries, and its easy access to the city centre.
Somerset West in the winelands is also increasing its allure as an investment destination, especially among Gauteng semigrants. Westridge, Dennegeur, Helderberg Estate and Erinvale Golf Estate feature among this year’s winners.
Derek Grobler, manager for Seeff Somerset West, refers to the area’s growing number of security and lifestyle estates, which offer newly built modern homes at competitive prices. Somerset West is between the university town of Stellenbosch to the north and the seaside village of Strand to the south, with easy access to the N2 highway, which takes you to the international airport in one direction or to Hermanus in the other.
Grobler says Erinvale is popular among UK and European swallows and has a large German community. The estate offers a selection of sectional-title apartments priced at R3.8m-R6.7m, and freehold houses at R8m-R20m.
TSHWANE
There are few surprises in the Jacaranda City’s rankings. Tshwane’s leaderboard is again dominated by a cluster of countrified golf and wildlife estates, either on the city’s eastern fringe or near Centurion to the south.
Perennial outperformers in the east include Mooikloof Equestrian Estate, Silver Lakes Golf & Wildlife Estate, The Hills Eco Golf Estate, Lombardy Estate and Six Fountains Residential Estate.
Winners to the south are Blue Valley Golf & Country Estate, Southdowns Residential Estate and the quaint village of Irene.
Mooikloof and Southdowns are Tshwane’s only two estates where average prices have exceeded R5m this year.
Mooikloof attracts some of the city’s most affluent buyers of grand homesteads, many of which exceed 1,000m² under roof on extensive 10,000m² plots. Prices range between R6m and R12m, while top-end homes can fetch up to R30m.
Gerhard van der Linde, MD for Seeff Pretoria East, says Mooikloof offers an unparalleled lifestyle with plenty of green spaces, hiking and biking trails, as well as equestrian facilities and the presence of free-roaming buck. It’s also close to the N1 and N4 highways, as well as the R21, which goes to OR Tambo airport, and it is near schools as well as medical, shopping and leisure facilities.
Southdowns, which prides itself on its biodiversity and sustainable development approach, is built on land that was originally part of the neighbouring Irene dairy farm. It has its own natural gas and electricity supply as well as a water reticulation plant, all maintained by the homeowners’ association. Residents have direct access to the Irene Golf Club as well as to 13km of walking trails along the Hennops River.
A few kilometres towards Midrand, near the Kosmosdal Samrand interchange on the N1, lies Blue Valley Golf & Country Estate, Tshwane’s best-performing suburb in the R3m-R5m bracket.
Prices at Blue Valley have risen an average 26% over five years. According to Rapheal Adeyemi, area agent for Jawitz Properties, this family-friendly estate offers top-notch security and well-maintained parks and playgrounds. Recreational amenities include soccer fields, squash and tennis courts, a fitness centre and a Gary Player signature golf course. Blue Valley also has its own conservation area and thriving birdlife.
The estate has about 1,500 sectional-title townhouses and free-standing homes. Adeyemi says prices for three-bedroom, two-bathroom townhouses start at R2.5m, while freehold properties vary between R3.2m and R19m, depending on size, building style and quality of fixtures and finishes.
Lombardy Estate, which backs onto Silver Lakes off Lynnwood Road, offers a country lifestyle while still being in close proximity to schools, hospitals, shops and the city’s eastern commercial hub. The estate’s prairie building style, typical of US architect Frank Lloyd Wright, features lakes, dams and extended green spaces as well as a clubhouse and tennis courts. Prices are more affordable than at some neighbouring estates.
ETHEKWINI
As in Gauteng, more homebuyers in eThekwini are going for enclosed estates. Big spenders are gravitating towards either the lush valleys of Kloof, a 20-minute commute northwest of Durban, or old favourite Umhlanga on the north coast.
Top-end suburbs with average prices of more than R5m are few and far between in eThekwini. Kloof’s Cotswold Downs Golf & Country Estate and Umhlanga’s exclusive Izinga Estate are the only two in this bracket.
Cotswold Downs is the top performer for the second year running. It’s a low-density gated community, set amid rolling hills, indigenous flora and nature trails. Leisure amenities include a championship golf course, a restaurant, a coffee shop, a gym, pools and padel courts. It’s a stone’s throw from some of the province’s best private schools, including Kearsney College and St Mary’s Diocesan School for Girls.
According to Harcourts Upper Highway agent Vanessa Cook, Cotswold Downs offers both sectional-title and freehold properties, with townhouse prices from R2.7m to just over R4m and larger standalone houses fetching from R4.5m to R20m.
Cook says the nearby village of Hillcrest, with its farm-like atmosphere, country restaurants and scenic picnic spots, offers a reprieve from the city’s hustle and bustle. “Hillcrest is a place where you still know your butcher’s name.”
Crestview, also on the northwestern outskirts of the city past Pinetown, is the top performer in the R1.5m-R3m segment. Cook highlights value for money as a key consideration in this area, which attracts equestrian enthusiasts and those looking for a slower pace. Rustic homes on half-acre plots cost less than R2m. Stunning valley and ocean vistas are another big drawcard. In addition, Watercrest Mall in Waterfall is just a few minutes’ drive away.
Brighton Beach shone in the R1.5m-R3m bracket as well. This blue-collar beachfront neighbourhood is centrally located on The Bluff, between the city centre to the north, the old Durban international airport to the south and several industrial areas. It’s popular among surfing, fishing and diving enthusiasts. A three-bedroom, two-bathroom standalone house on a 1,000m² plot will set you back less than R2m.
Sibaya Coastal Precinct near Umdloti on the north coast reigns supreme in the R3m-R5m segment. It’s the mixed-use development’s first appearance in the FM suburb rankings. Brett Botsis, director for Seeff Umhlanga, says the precinct is an exciting addition to the Durban North residential landscape with its mix of commercial, retail, education and leisure opportunities. He believes its spectacular coastal setting is what sets Sibaya apart from other north coast gated developments.
The precinct has seven development nodes, a 300ha indigenous coastal forest and a 6km coastline. It’s close to the Umhlanga CBD and beachfront, King Shaka International Airport and top schools such as Reddam, Umhlanga College and Crawford.
Small two-bedroom apartments start at R1.4m, while larger and more luxurious units cost R2.5m or more. Modern standalone homes are priced from R7m to R9m on average.
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