The Real Estate Market in South Africa


The real estate market is the billionaire moves if you are looking for a long term investment opportunity. Real estate involves a lot of things other than just the property on top of land. Real estate involves land, the property on top of the land, air rights above the land and below the land too. Just like any other market, it is greatly determined by the laws of demand and supply. The South African real estate market has been going through a rough patch for a few years now.

South Africa Real Estate

There are various types of real estate; residential, commercial, land and industrial. The most common that people encounter is the residential real estate. Over the last 6 years, the South African real estate market rates have dropped by about 4.8% below the inflation rates. This drastic fall in the property market is due to the deteriorating nature of the South African economic performance. This low rates on property are expected to remain below the inflation rates for quite some time. The rates are expected to remain confined within 3.5% to about 4.5%.

In the first quarter of 2019, a drastic and large drop was experienced in the economy of South Africa. Statistics conducted by Statistics South Africa show that the country’s central bank had to cut its growth projection from 1.3% to about 1%.  For a few years now, the south African real estate market has been undergoing some really difficult times. The social, political and economic environment is not doing enough to help with the situation either. Despite all these challenges, South Africa still regards real estate as the safest investment to engage in. Investors are advised to buy property at this time because of the low rates. This will be more economical than waiting till the rates start rising.

Property Investment Methods

In the past real estate companies relied on traditional methods to make sales on property. Some of these methods included:

  • Hanging boards outside houses written ‘for sale’.
  • Advertising on newspapers.
  • Face to face meetings.
  • Direct mail marketing.

Over the years these companies had to find more innovative ways of marketing. These companies now have social media websites. Some companies even go ahead to establish newsletters. Most companies have developed brand awareness just for this reason. Better marketing strategies enable companies to make more sales. This gives them a competitive advantage over the others.

Types of Property Investments in South Africa

There are various types of property investment you might want to engage in. South Africa happens to have a variety.

Primary property investment

To most people, owning a property makes them feel secure. To facilitate this, some people take home loans. These loans enable them to either build or buy investment properties. Over time the property is assumed to appreciate in value. This makes the investment even more profitable to the owner.

Buy to Let Investment

These types of property can either be residential, commercial or retail. This type of investment had been tested and proved to be profitable if well managed. For this to be more profitable, the management has to put into consideration the location, quality and property type.

Offshore Buy to Let Investment

In South Africa, this type of investment is very profitable for those who can afford it. It allows investors to earn foreign currency which is much stronger. They can also gain citizenship through this.

Considerations Before Investing in the South African Real Estate Market

South Africa is a great place to invest. Nevertheless, this does not mean that it is an easy place to invest in. There are a lot of considerations to put in place before placing your investment.

Type of Investment

The type of investment you want to engage in is very important. Residential property is the best type of investment. Residential property is very profitable than any other. This is because no matter what, people want to live in a place that feels like home. Choose your investment type according to your investment needs


The location of your investment is very vital in the real estate market. Investing on a property that is in a desirable location is very beneficial. For instance, places with good security are more expensive as compared to other areas. This makes it possible for investors to fetch high prices for their property. Investing your property in Cape Town is more profitable than Richwood.


The real estate market in South Africa is a very good investment opportunity. South Africa is a fast growing country with major opportunities in the real estate market. The type of investment and location of your investment are the major determinants of success in the market. Marketing strategies are also very vital in the real estate markets.

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