- South African property prices have increased by 98% since 2010, with Cape Town experiencing a remarkable 141% surge, outpacing other major metros.
- Factors contributing to Cape Town’s property boom include semigration to the Western Cape, international buyer interest, and the flourishing commercial sector that attracts job seekers.
- Cape Town’s improved service delivery, lower residential vacancy rates, and efforts to mitigate load shedding further contribute to its position as a leading property market in South Africa.
Recent data from Statistics South Africa (StatsSA) highlights an astonishing 98% increase in property prices across South Africa since 2010, with Cape Town experiencing a remarkable 141% surge in the same period. This significant increase has outpaced other major metros, establishing Cape Town as a key player in the national property market.
StatsSA reports that since August 2014, Cape Town has consistently exhibited higher property price increases compared to other metropolitan areas. After a brief plateau in 2018 and 2019, property prices in the city soared once more. To analyze these trends, the latest data compares eight metropolitan municipalities across nine provinces, using a new set of residential property price inflation (RPPI) metrics.
The RPPI assesses the change in prices for various types of residential properties, including houses, townhouses, and flats purchased by private individuals. In contrast to Cape Town’s booming property market, Johannesburg has seen the slowest growth in property prices since 2010, with an average increase of 71%. Overall, all major metros experienced a 98% increase in property prices during this period.
Here’s a breakdown of the property price increases in various metros, as provided by StatsSA:
- Cape Town: +141%
- All Metros: +98%
- Ekhuruleni: +94%
- Tshwane: +91%
- Buffalo City: +89%
- eThekwini: +80%
- Nelson Mandela Bay: +77%
- Mangaung: +72%
- Johannesburg: +71%
Recent RPPI data reveals that property prices nationwide increased by 5.8% in the 12 months leading up to November 2022. In particular, prices rose by 7.4% in the Western Cape and by 3.6% in Gauteng during this period.
Cape Town’s property boom is attributed to various factors, such as semigration to the Western Cape, increased international buyer interest, and an influx of job seekers drawn by the city’s flourishing commercial sector. The latest Rode’s Report on the South African Property Markets for 2023 places the Western Cape at the forefront in the first quarter of the year, boasting a lower residential vacancy rate compared to other regions.
Cape Town’s thriving commercial sector has attracted businesses, providing more job opportunities and bolstering the local economy. Brent Townes, COO for commercial property at Lew Geffen Sotheby’s International Realty, emphasizes that semigration is not the only driving force for families; the region is becoming an economic powerhouse.
Improved service delivery in the area also attracts people to the Cape. The Auditor-General recently noted that only 41 of the country’s 257 municipalities received clean audits, and 22 of those were in the Western Cape. Moreover, Cape Town frequently experiences lower load shedding stages than other parts of the country, thanks to hydroelectricity from the Steenbras Dam.
Rodes reports that over the next three years, Cape Town aims to provide at least four stages of load shedding protection. Strategies to achieve this include purchasing power on the open market, incentivizing businesses and residents to sell power back to the city, and investing in solar farms and gas projects.
The ongoing growth of Cape Town’s property market, combined with increased economic opportunities and improved service delivery, underscores the city’s prominent role in South Africa’s overall property landscape.