Cape Town property market booming

The Western Cape saw the strongest growth in house price inflation among the three major regions in South Africa, and Cape Town is the only major metro housing market where prices have stabilised rather than declined.

This is according to the Pam Golding Residential Property Index, which revealed that while the national house price inflation rate has shown clear signs of stabilisation in recent months, the country’s soaring inflation rate took its toll on growth in real prices. 

However, with inflation being brought back under control, the outlook for real national house price inflation is markedly more positive in 2024.

The Western Cape housing market has registered the strongest growth among the three major regions during the past four years, including the year to date, with KwaZulu-Natal following in second spot.

In addition, house price inflation in all major metro housing markets is losing momentum, except Cape Town, where price growth stabilised at 3.8% in recent months. 

Johannesburg is the only major metro where prices are declining from year-earlier levels, being in negative territory since January 2023.

Within Gauteng, all three sub-regions are experiencing slowing growth in house prices, with only Johannesburg recording year-on-year declines.

Regarding the coastal metros, a period of outperformance by Nelson Mandela Bay has now ended, while Cape Town is currently the top performing among the three major coastal metros.

Pam Golding CEO Andrew Golding previously said that demand for property in Cape Town is booming as tourists return, foreigners buy local property, and South Africans emigrate from the country’s northern regions. 

He said they are seeing a significant increase in demand from tourists and South Africans wanting to semigrate to the Cape. 

Aside from increased demand for tourism, Cape Town is also benefiting from a surge in semigration from various regions, generally to the north of the country. 

In addition, international upheaval has made the Cape an attractive proposition for numerous international buyers, Golding said.  

Prospective buyers are particularly attracted to the well-managed Cape Town Metro and the diverse lifestyle offerings from the Atlantic Seaboard with its vibrant V&A Waterfront to the vineyards and tranquillity of the Southern Suburbs. 

Cape Town has already seen an influx of international buyers active in the market – not only in the top end but across all price ranges, demonstrating confidence in the City’s property market.

Golding said another factor is that South Africa offers exceptional value for money.

In Cape Town, for example, $1 million will enable you to acquire a residential property of approximately 200 sqm. For comparison, the same price tag will only secure 33 sqm in New York, 34 sqm in London, 43 sqm in Paris, 44 sqm in Sydney and 17 sqm in Monaco.

Furthermore, Golding said this does not compromise on the lifestyle offered in South Africa, which is among the best available elsewhere in the world. 

Importantly, this segment of the market also remains relatively unaffected by interest rate hikes as more affluent buyers are relatively unaffected by them.