What the average South African is paying for a house right now – with one province booming

According to Lightstone data, the first quarter of 2024 saw a surprisingly robust property market, with average purchase prices below R1.5 million.

According to the data, the activity in the first quarter of 2024 was quite similar to that of the previous year.

Lightstone indicated that about 47,276 transactions, worth a total of just over R65 billion (R65,099,737,401), were recorded during the January-March period of 2024.

The average transaction price for the first quarter was R1,377,014.

The majority of property transactions, accounting for 71.4%, are below R1.5 million. Transactions between R1.5 million and R3 million make up 19.7% of the market.

Only 9% of all property transactions are above R3 million, but this sector generates 36% of the total value of all transactions, which equates to over R23.7 billion (R23,749,144,965) at an average price of around R5.5 million.

The majority of sales were for freehold properties, which represented almost 50% (around 23,200) of all transactions.

On the other hand, sectional titles accounted for just over 30% (approximately 14,600 units) of all transactions. Freehold properties were sold at an average price of slightly over R1.5 million, while sectional titles were sold at an average price of just over R1 million.

Cape Town is booming

The high-end real estate market showed unexpected strength, with transaction volumes similar to those in the first quarter of 2023 and better than the last quarter of the previous year.

According to Lightstone’s data, the majority of transactions took place in Cape Town, with sales amounting to almost R800 million, mostly in the Atlantic Seaboard and City Bowl suburbs and the Southern Suburbs.

The areas with the highest volume of sales exceeding R20 million were Clifton, Camps Bay, and Constantia.

However, only a single sale exceeded R50 million at the Waterfront.

Approximately 32% of the sales were made to international buyers, including:

• Three German buyers at R20 million, R23 million, and R24.5 million,
• Two Swiss buyers at R20 million and R21 million, and
• Individual buyers from the UK (R38 million), Netherlands (R37 million), Belgium (R25 million), and USA (R25 million).

According to Ross Levin, a licensee for Seeff Atlantic Seaboard and City Bowl, the number of properties sold for R20 million or more in areas such as Clifton, Camps Bay, and the Waterfront has significantly increased over the past three years.

Levin also states that the property market seems to be quite strong overall.

Constantia and Bishopscourt have also seen some of the highest volume of R20 million-plus sales over the last three years, and the momentum continues according to Francois Venter, who is a luxury market specialist with Seeff Southern Suburbs.

Buyers appear to be taking advantage of the flat price growth, says Seeff. House price growth has been around 2% to 3% at best.

Even with FNB noting improved activity during the first quarter, the FNB House Price Index pointed to average price growth remaining weak at around 0.7% as of February.

Samuel Seeff, chairman of the Seeff Property Group, noted that some areas performed better than expected, with some price sectors achieving better sales compared to the last quarter of last year.

“The highest price bands have been more active in some areas, mostly the Cape coastal areas, while the lower price bands continue to feel the strain of the higher interest rate,” he said.

Read: New homebuying trend hits South Africa’s middle class as interest rates bite