Gauteng coming for the Western Cape’s crown

Despite the spotlight on semigration to the Western Cape, new data shows Gauteng is driving South Africa’s population and housing demand growth.

Dr Andrew Golding, chief executive of the Pam Golding Property Group, highlighted Gauteng’s impressive population surge.

“Despite the market focus on ongoing semigration to the Western Cape, the latest Stats SA data reveals that Gauteng is experiencing by far the strongest growth in population and, as a consequence, housing demand,” he said.

“According to Stats SA’s recently released 2025 Mid-Year Population Estimates, South Africa’s total population has risen to 63.1 million people.”

A growing percentage of the country’s population lives in Gauteng, at 25.4% in 2025, and the Western Cape, at 12%.

“Further to this, between 2021 and 2026, Stats SA estimates that Gauteng will experience net migration of over 786,000 people to the province,” Golding added.

This is more than double the almost 319,000 estimated to be relocating to the Western Cape during the same period.

While this is promising for Gauteng’s housing market, Golding said that it also raises concerns about potential housing shortages.

“During the past decade, this province has completed just under 151,000 new homes, which is only 25% more than were built in the Western Cape during the same period,” Golding said.

Notably, the Western Cape has begun to pass more residential building plans than Gauteng in the last few years. This suggests that future building activity in Gauteng is set to fall even further behind its growing population.

According to the Gauteng City Region Observatory, released in October 2024, 36% of the province’s adult residents were born elsewhere in South Africa.

The largest share came from Limpopo, followed by KwaZulu-Natal and the Eastern Cape. Most migrants were motivated by economic factors.

The latest Pam Golding Residential Property Index revealed that the recovery in national house price inflation (HPI) continues to gather momentum, rising to 4.4% in July 2025.

At the same time, real (inflation-adjusted) HPI eased to 0.9% in the same month, marking the sixth consecutive month of real growth.

Western Cape leads house price growth

The Index also showed that the upper price band above R3 million registered the most robust growth at 6.2% in July. The R2 million to R3 million price band followed, at 6%, while prices below R1 million rose by 3.4% during the period.

“The Western Cape continues to outperform other regional housing markets, with growth in house prices rising to 7.2% above year-earlier levels in July,” Golding said.

Both Gauteng and KwaZulu-Natal continue to rebound, with KZN (3.2%) now slightly ahead of Gauteng (2.5%).

“Notably, investment demand in the Western Cape remains robust, accounting for 31.1% of all ooba Home Loans applications received in July,” he said.

“Also of interest is that the recovery in coastal house prices continued to outpace the rebound in non-coastal HPI in July, with prices rising by 6.7% and 4.5% respectively.”

As a result, Golding explained that the coastal price premium continued to widen, rising to 2.3% in July.

“Positively for sectional title investors and owners, HPI also continues to gather impetus, rising to 4.5% in July,” he added.

This was marginally outpaced by the acceleration in freehold HPI, which rose to 5.2% above year-earlier levels. Year to date, freehold HPI averaged 4.5% compared to 3.8% for sectional title properties.

Lightstone data showed that Cape Town continues to outperform other major metro housing markets by a wide margin, rising by 7.4% in July. This was followed by eThekwini at 3.3% and Tshwane at 3%, with Johannesburg HPI of 1.7%.

Within Gauteng, HPI in Tshwane saw the region outperform the other two metro housing markets. House prices rose by 3% in July, outperforming both Ekurhuleni (2%) and Johannesburg (1.7%).

“Encouragingly, after stalling for several months, and according to ooba Home Loans, demand from first-time buyers has rebounded, rising from 46.4% of all applications in recent months to 47.6% in June/July 2025,” Golding said.

“Recent interest rate cuts, subdued inflation and petrol price reductions are all expected to support first-time buyer demand during the remainder of the year.”

Additionally, Golding pointed out that the pricing of home loans is becoming more competitive, with the average national concession relative to prime easing to -0.75% in July.

“The Western and Eastern Cape continued to enjoy the most competitively priced loans last month at -0.92% and -0.77% respectively,” he said.

“Ooba Home Loans also reports that over the past three months, pre-qualified applicants continue to enjoy a significantly higher approval rate of 90.2%, compared to 79.8% for applications without pre-qualification.”