Young people can’t afford houses in South Africa

Rising property prices and affordability pressures are making it harder for young South Africans to enter the property market, forcing them to adapt their home-buying strategies.

For many young South Africans, the goal of owning a home may feel harder to reach than it did for previous generations.

Rising property prices, higher living costs, and economic pressure have changed how young people enter the property market.

According to FNB, though, young buyers have not given up on climbing the property ladder. Instead, they are finding different and more practical ways to get there.

The bank’s data show that over the past decade, the share of property buyers under 35 has declined from 38% to 31%.

However, young customers remain firmly represented in the first-time buyer market, accounting for nearly half of all first-time home purchases.

This suggests that while fewer young people are entering the property market, those who do are approaching the decision with greater intention, adaptability, and long-term thinking.

FNB Home and Structured Lending Product Head Vanashree Naidoo said many young professionals and graduates still see homeownership as an important part of building financial stability.

However, they need the right support to understand affordability, credit usage, and long-term financial planning. “Buying a home is one of the biggest financial decisions a young person can make,” Naidoo said.

“The challenge is not only whether they can afford the monthly repayment, but whether they understand how to use credit responsibly to build long-term value.”

Naidoo stressed that not all debt is negative. A key distinction is between debt that creates pressure and debt that can support progress.

“A home loan, when structured correctly and within a customer’s affordability, is a form of good debt,” she explained.

“It allows one to invest in an asset that can grow in value over time, while also helping to build a foundation for long-term financial well-being.”

Young South Africans change their buying strategy

As property prices have increased, young buyers have adjusted their expectations. In 2015, more than a third of young buyers purchased homes valued below R400,000.

By 2025, that figure had declined to just 14%, reflecting a significant shift in the availability and affordability of entry-level properties.

Rather than stepping back from the market entirely, young buyers are adapting by targeting higher price brackets and planning their homeownership journeys more deliberately.

The proportion of young and first-time buyers using mortgage finance has increased significantly, with around 76% relying on home loans to secure a property.

This trend shows the importance of financial solutions that help bridge the gap between income, property prices, and aspirations.

FNB’s data also reveals that young and first-time buyers make greater use of higher loan-to-value financing, reflecting the growing role of tailored credit solutions in enabling market entry.

This suggests that access to responsibly structured finance is a critical part of making home ownership possible.

According to Naidoo, today’s young buyers are approaching homeownership differently, with many starting with sectional title properties as a more affordable entry point.

They view their first property as a stepping stone rather than a final destination, and this strategy allows them to purchase independently earlier in life.

“This generation is adaptable, informed and focused on long-term value. Young buyers are not necessarily following the same route as previous generations, but they are still finding practical ways to enter the market,” she said.

FNB’s data supports this shift in behaviour. The weighted-average tenure of home loans held by homeowners under 35 is just under seven years.

This relatively short holding period points to a growing level of financial awareness among younger buyers, who are increasingly prioritising early loan settlement and using property ownership as a strategic stepping stone.

FNB is seeing that many young homeowners are choosing to sell and upgrade within this timeframe. This reflects a more deliberate and proactive approach to building long-term property wealth.