The Western Cape continues to lead a growing trend in South Africa's property market, with investment buyers significantly boosting demand in the region.
According to the latest data from Ooba, "34% of all bond applications received in the Western Cape during the fourth quarter of 2024 were for investment properties. This represents a significant increase from 29% in the same period the previous year"
The increase in investment properties in the Western Cape aligns with national trends, indicating that real estate has become the " second most popular asset class in South Africa"
The South African Investor and Banking Report also revealed that "national demand for investment or buy-to-rent properties reached 13.9% of total applications in the fourth quarter of 2024, up from 11.8% in the same period in 2023"
Claude McKirby, Co-Principal for Lew Geffen Sotheby’s International Realty in Cape Town’s Southern Suburbs and False Bay said the new developments "reflects growing confidence in the stability and long-term returns offered by property"
“Property is no longer just a place to live, it’s increasingly seen as a means of securing financial stability and creating generational wealth and this is becoming particularly evident among younger buyers, who are entering the market with a long-term perspective,” he said.
The Eastern Cape also showed significant growth in investment demand during the final quarter of last year, increasing from 14% of all applications in Q3 ’24 to 18% in Q4 ‘24.
“This shift is driven by the dual appeal of property as both a high-return investment and a reliable safeguard against financial losses and further fuelled by strong demand for rental properties in most areas" McKirby added.
“Another contributing factor is the affordability of sectional title homes, which make up around 60% of investment purchases. These properties are particularly appealing to first-time investors, who often opt to rent out their purchases while continuing to rent their own homes.”
Rhys Dyer, CEO of ooba Home Loans, emphasises that 10% of first-time buyers are now acquiring property for investment purposes, which is a notable increase from 4% in 2014.
McKirby further stated that the Western Cape's leadership in the investment buyer market showcases both the region's lasting appeal and the increasing acknowledgment of property as a dependable asset class.
“For investors, the province represents a unique opportunity to capitalise on a thriving rental market and stable property values and for first-time buyers, it offers a pathway to financial security and generational wealth.“
"And in a time of economic uncertainty, the resilience and appeal of property as an asset class provide a beacon of hope for investors and homeowners alike. As the South African property market evolves, one thing is clear: the Western Cape is leading the charge, setting the standard for investment potential in the years to come and, as more South Africans embrace real property as a tool for wealth creation, the demand for investment properties is likely to continue its upward trajectory,” McKirby concluded.