Best news for South Africa’s property market in years – with a catch

South Africa’s removal from the FATF’s greylist is set to boost investor confidence, lower borrowing costs, and revive the local real estate sector, but experts warn that if these improvements cannot be sustained, the country will pay the price.

More than two years after South Africa was added to the Financial Action Task Force (FATF) greylist in February 2023, South Africa was officially removed from the list on 24 October 2025.

According to Chas Everitt International CEO Berry Everitt, this removal is positive for the economy as a whole and will also add impetus to housing demand and the real estate sector’s recovery.

He noted that whether they realised it or not, all South Africans have been negatively affected since the country was placed on the greylist in 2023.

Following this decision, the country was put under increased scrutiny by the FATF for anti-money laundering and counter-terror financing (AML/CFT) deficiencies.

In the years since, South Africa’s government and the business sector have worked hard to achieve the required improvements, Everitt said.

They focused on improving areas such as beneficial ownership transparency, supervision of non-financial businesses and professions, including real estate agents, and legal and accounting trust frameworks.

“And what they have achieved with the removal of South Africa from that list is an improved risk profile and increased investor confidence in our financial system and its institutions, which will also affect all South Africans,” Everitt said.

“For a start, it will mean lower borrowing costs for the government, state-owned enterprises, municipalities and other entities, and possibly the opportunity to negotiate lower rates of interest on existing debts.”

He explained that this should make it easier to restore and even improve vital trade infrastructure like railways, harbours and roads.

South Africa is not out of the woods yet

According to Everitt, getting off the list should also encourage more direct local and foreign investment into South Africa.

This investment will not just in be bonds and equities, but also in new businesses, especially now that the African Continent Free Trade Area agreement is starting to gain momentum.

“Companies around the world are looking for ways to access the opportunities inherent in that agreement and in growth markets across Africa and are well aware that South Africa is one of the best gateways to those markets,” Everitt said.

He added that infrastructure projects and the establishment of new businesses will lead to much-needed job creation and significant new housing demand over time.

“But even before that, lower national debt will reduce the need for government to raise corporate and personal taxes and help to improve housing affordability for the average household,” he said.

“We believe it will also improve consumer sentiment about the future of South Africa and are thus expecting the real estate market recovery to gather additional speed over the next few months”.

Turning specifically to foreign purchasing of real estate, Everitt said the delisting will result in international buyers seeing South Africa as a lower-risk jurisdiction.

It will also improve the attractiveness of investment in local residential and commercial properties, which continue to offer exceptional value in global terms.

“International real estate transactions often involve cross-border capital, finance vehicles, trusts, and special purpose vehicles, and the delisting should reduce the costs of AML/CFT compliance while also improving access to finance,” he said.

“Local developers planning large projects such as new lifestyle estates should now also find it easier to structure investment and foreign capital inflows, and hopefully also reduce the ‘country premium’ or risk-adjusted cost of capital.”

However, Everitt cautioned that removal from the greylist does not mean that all AML/CFT risks vanish overnight.

“As a member of the Leading Real Estate Companies of the World network, which spans more than 70 countries, we are acutely aware that real estate remains a high-risk sector globally for money laundering,” he said.

This is because real estate is a high-value physical asset often involving opaque ownership. For this reason, Everitt stressed that buyers and sellers should not cut corners when it comes to real estate documentation.

They should also deal only with registered property practitioners who adhere to the highest standards of compliance with Financial Intelligence Centre measures.

These standards have been implemented specifically to make South Africa’s financial system resistant to abuse by criminal elements.

“The FATF will be watching South Africa to see if it can sustain the improvements made over the past two years,” he added. “We all need to do our best to ensure that we don’t go back on the greylist, or we will all once again pay the price.”