Luxury Property Market Gaining Momentum
According to BetterBond, home loans for properties above R3 million have grown by 6.6% this year, reinforcing the strength of demand for premium real estate.
01/10/2025
South Africa’s luxury property market is
thriving, with discerning buyers competing for
homes in the country’s most exclusive suburbs.
According to BetterBond, home loans for
properties above R3 million have grown by 6.6%
this year, reinforcing the strength of demand
for premium real estate.
“Five interest
rate cuts in recent months have stimulated buyer
activity for relatively higher priced homes
around the country, and particularly in the
country’s metropolitan areas,” says Bradd
Bendall, BetterBond’s National Head of Sales.
“As a result, according to BetterBond’s
September Property Brief, home loans of more
than R3 million make up 10% of all bonds granted
in the past 12 months, and the share of bonds
for homes of R2 million to R3 million accounted
for 7% of all loans.”
Combined, bonds for
homes of more than R2 million make up 22% of all
home loans granted by BetterBond in the 12
months to August 2025. What is encouraging is
that homebuying activity for properties between
R1 million and R1.5 million has strengthened,
accounting for 20% of the share of loans
granted, notes Bendall. “If interest rates drop
again towards the end of this year or early next
year, we could see even more activity for
higher-priced homes.”
The latest
Africa
Wealth Report 2025 by Henley & Partners and New
World Wealth names South Africa as the
wealthiest on the continent, with Cape Town and
Johannesburg ranking as two of the wealthiest
cities. According to the report, 41 100
millionaires call South Africa home. The five
suburbs with the most expensive properties of an
average of upwards R20 million are all in Cape
Town. Suburbs such as Camps Bay, Clifton,
Constantia, Bantry Bay and the Waterfront are
the most expensive. These suburbs saw over 120
properties sold above R20 million in 2024,
totaling more than R3.6 billion in sales value.
Some sales reached over R50 million.
As
Lightstone reports, the Western Cape accounted
for around 40% of transactions above R10 million
in 2024, underscoring concentrated activity at
the top end of the market. Although the
destination of choice for 12% of the country’s
population, the Western Cape accounts for 18% of
the volume of property transactions and almost
31% of the value. One of the reasons for the
popularity of the province is that it boasts
better governance and economic growth. The
province comes out top in the
2024 Governance
Performance Index (GPI) by Good Governance
Africa (GGA), which assesses local
municipalities and aggregates results by
province. A home in Nettleton Road, Clifton,
sold this year for a record-breaking R157
million.
The luxury market in Gauteng is
also performing well, with a strong demand for
high-end properties in suburbs such as Sandton,
Hyde Park and Bryanston. “These suburbs have
plenty to offer, with secure properties close to
popular restaurants and recreational activities,
reputable schools and economic opportunities,”
says Bendall. A Property24 search shows several
properties in Hyde Park listed for R55 million,
and a couple of homes in Sandhurst, Sandton and
Bryanston around the R89 million mark.
KwaZulu-Natal also appeals to higher-end buyers,
with average property prices in coastal suburbs
such as Umhlanga of around R5.2 million,
according to Property24. Estate living is
particularly desirable in this province, and
Property24 has homes in the Izinga listed for
upwards of R13 million.
Foreign buyers
are also seeing value in snapping up prime
property along the Atlantic Seaboard or the
Winelands. Lightstone reported earlier this year
that overseas buyers pay on average R2.7 million
for property in South Africa. This is well above
the current average purchase price of R1.6
million as reported in BetterBond’s September
Property Brief. Lightstone also confirmed the
Western Cape as the preferred destination for
foreign buyers in most price bands. They
accounted for just over 40% of all property
transactions above R10 million, 25% of
transactions between R5 million and R10 million,
and around 15% of all transactions in the R3
million to R5 million price range. “With a
favourable exchange rate and the appeal of a
comfortable climate and scenic attractions, the
Western Cape remains a perennial favourite with
foreign buyers,” says Bendall.
“South
Africa’s luxury property market continues to
demonstrate remarkable resilience, fuelled by
strong local demand, international interest, and
the enduring appeal of exclusive suburbs in both
Cape Town and Johannesburg,” concludes Bendall.