Property trends to watch out for in 2025
South Africa’s property market is undergoing significant transformations, and Property24, the country’s largest online database of property for sale or to rent, has been picking up on some interesting trends.
In an interview with BusinessTech, Property24 CEO Nalen Naidoo said that emerging trends in South Africa’s property market include (but are not limited to):
- A growing rental market;
- A shift in investment from Gauteng to the Western Cape; and
- Rising demand for properties with alternative power solutions.
These trends are observed amid Property24 recording a 6% year-on-year increase in sales values, a positive turnaround in a property sector that has been facing battles on multiple fronts such as the Covid-19 lockdown and stubbornly high interest rates.
Emerging trends
“The rental market is still extremely active,” with rental listings receiving considerably more interest than properties for sale, said Naidoo.
This is particularly evident in the context of high interest rates.
Lower interest rates generally make mortgages more affordable, stimulating demand and leading to increased sales activity and higher property values.
Additionally, affordability concerns, or a desire for greater flexibility are among other reasons for the strong demand in rentals.
However, Naidoo noted that there is a slight shift back towards sales as interest rates begin to decline.
Another significant trend is the shift in property values from Gauteng to the Western Cape, which he described as “a switch going on in terms of where the money is moving.”
The Property24 CEO said that while Gauteng remains larger in terms of the number of property transfers, the Western Cape has overtaken it in terms of the value of those transfers for the past two years.
This shift could be attributed to factors like perceived higher quality of life, increased investment opportunities, or a combination of both.
Another trend observed is the increased demand for properties with alternative power generation.
Naidoo said that this trend, although “often a very low base” initially, is becoming increasingly prevalent.
He attributes this to the growing need for energy security and the desire to reduce reliance on traditional power sources, adding that properties equipped with these features are becoming more desirable to buyers.
These include alternative power solutions such as solar panels and solar geysers.
Future trends
Looking ahead, Naidoo predicts several trends that will shape South Africa’s property market in the years to come.
First, is addressing the housing shortage, a problem that he said needs urgent attention, especially considering the country’s economic growth and the increasing number of people who can afford to buy homes.
He argues that unless this issue is addressed, it will pose a serious challenge to the country’s development.
Naidoo highlightedd the inadequacy of the current pace of new housing development, pointing out that the number of “new developments that come through every year” is “extremely low and it’s insufficient to replace this massive gap.”
He suggests that the solution lies in encouraging “innovative players” to “enter the market to find a way to deliver houses to this rising group of people that can afford houses.”
He added that “we have to find a way of building them faster.”
This could involve exploring new construction technologies, streamlining regulatory processes, and incentivising private sector involvement in affordable housing development.
Naidoo also believes that smart homes are an emerging trend that will impact the South African property market in the coming years.
He sees this trend as being driven by South Africans adopting the global trend of smart devices and smart homes.
Naidoo anticipates that this trend will “definitely influence the way homes are both designed, but then also used.”
He highlighted the interplay between smart home technology and the growing trend of working from home.
The Property24 CEO believes that as people continue to work remotely, the lines between home and office will blur.
This could lead to changes in how people use their living spaces and suggests that smart home technologies could play a significant role in this shift, enabling people to optimise their homes for both work and leisure activities.
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