The market has undergone significant changes in recent years, shaped by economic shifts and evolving buyer preferences and, more recently, the pandemic.
For 2025, several trends are set to define the landscape, offering opportunities and challenges for investors, developers and homeowners. Success in this dynamic market requires staying informed about trends, assessing individual goals, and aligning strategies with growth areas.
Semigration
Semigration will certainly continue in 2025 and beyond because, with work-from-home on the rise, people can choose where they want to live rather than having to live close to the workplace so we will continue to see strong demand for homes in scenic areas. Other factors, of course, include crime and safety and local council governance, with the best perceived governance being in the Western Cape.
The Growth of Secondary Cities and Small towns
Semigration is underpinning another trend that will continue – the rise of small towns. Since 2020, we’ve seen increased demand for suburban and semi-rural properties as remote work allowed buyers to prioritise space and lifestyle over proximity to city centres and this "Zoom town" trend will continue to influence the market, with ongoing growth being seen in smaller towns and coastal areas.
Driven by the rise of remote work and a desire for a simpler, more sustainable and balanced life, coastal towns like Hermanus and Plettenberg Bay and inland towns like Greyton and Darling are experiencing a surge in demand for primary residences.
Increased Focus on Lifestyle Estates
Secure lifestyle estates have shown the strongest growth in recent years, and they will continue to dominate South Africa’s property market, offering security, convenience and on site modern amenities.
In 2025, lifestyle estates are expected to expand beyond traditional luxury offerings, incorporating more affordable options to meet middle-income demand.
Growth Areas:
The Rise of Affordable and Mixed-Use Developments
As affordability becomes a central concern for many South Africans, developers are increasingly focusing on affordable housing projects and mixed-use developments, especially in urban areas where there is a massive demand for compact, efficient living spaces near amenities, commercial hubs and institutions of learning.
The lines between residential and commercial spaces will continue to be blurred as urban development redefines living experiences with ongoing development of mixed-use spaces.
Mixed-use developments - where residential, commercial, and recreational spaces coexist - are gaining traction in major cities like Johannesburg, Cape Town, and Durban as they offer convenience for residents by reducing commute times and increased investor appeal through diversified revenue streams.
In 2025, expect more integrated spaces like Waterfall City in Johannesburg, with a focus on affordability and community-driven design.
Spike in First-time Buyers
First-time buyers have emerged as a key demographic, however, higher interest rates in 2023 tempered affordability, leading to a more cautious approach among these buyers. Sellers, in turn, faced longer listing periods and pressure to price properties competitively.
We have now turned a corner, and interest rates are slowly coming down again, so we expect to see more market activity, especially at the lower end of the market. Many of these buyers are young professionals and families seeking to enter the market as interest rates decline, conditions will become increasingly favourable, especially for those with stable incomes.
Women, who already count for more than 50% of these buyers will continue to be the strongest first-time buyer market.
The Rise of Collective Ownership
Collective ownership or co-buying is becoming an increasingly attractive option for individuals seeking to gain a foothold in the competitive market and, with the cost of living on a steady upward trajectory, this trend is likely to gain traction in the coming years.
This arrangement involves two or more individuals jointly purchasing a property, often friends, family members, or business partners. Co-ownership allows buyers to pool resources, share financial responsibilities, and enter the property market sooner than they might individually. It is particularly appealing to first-time buyers and young professionals seeking to invest in desirable areas.
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