Goodbye Gauteng – Millionaires rushing to a new home in South Africa
South African and international millionaires are increasingly moving to the Western Cape, with Gauteng losing its crown as the nation’s wealth capital.
A new report, commissioned by Standard Bank Wealth and Investment, states that South Africa’s affluent class have rewritten where they choose to earn, live and invest.
While Gauteng was previously the main place for South Africa’s high-net-worth individuals (HNWIs), this is slowly switching to affluent coastal populations in the Western Cape and KwaZulu-Natal.
“From the hustle corridors of Sandton to the coastal estates of Ballito and the vineyards of the Cape
winelands, HNWIs are now distributed across three distinct but interconnected regions,” the report said.
To this end, the Western Cape has now completed a transition that seemed impossible a decade ago; it is home to more HNWIs than any other province in South Africa.
With 17,300 dollar millionaires, according to the latest Africa Wealth report, the Western Cape overtook Gauteng and is pulling away.
The report said that the main drivers for the move are improved quality of life, reliable governance, natural beauty, and an increasingly global outlook.
Gauteng remains the nation’s “hustle capital,” and its concentration of financial institutions, corporate headquarters, mining interests, and entrepreneurs made it the nation’s de facto wealth hub.
While the status has not changed, the primary driver of the reversal is semigration, the movement of affluent families from Johannesburg and Pretoria to other parts of the country, especially the coastal areas.
Wealthy South Africans from the Gauteng area are also increasingly splitting their time between their home base and coastal areas, buying coastal homes in the latter.
International migration is also underway, with a host of wealthy Europeans from Germany and the UK drawn to Cape Town’s reputation as a world-class city.
Foreigners benefit from a favourable exchange rate and the relatively accessible entry price for prime real estate compared to London, Zurich, or Sydney.
While the majority of Standard Bank’s Western Cape private-wealth clients remain in South Africa, the international segment is growing.
Standard Bank’s forecasts believe that Cape Town’s ultra-wealthy population could double over the next decade.
Cape Town is home to the nation’s highest number of high-net-worth individuals (HNWIs), thanks to its mountains, coastlines, vistas, and wine farms.
KwaZulu-Natal also booming
While most of the attention on internal migration in South Africa focuses on the Western Cape, KZN has also undergone a profound transformation over the last two decades.
The province was previously defined by old money, with generational wealth built on farmland, warehousing, and businesses passed down over three or four generations.
The province, particularly its north coast, has now emerged as one of the country’s main HNWI destinations.
JD Desai, head of Standard Bank Wealth and Investment for KZN, said there has been northward wealth migration along a coastal strip encompassing Durban North, Umhlanga, La Lucia, and Ballito.
The north coast also attracted a new type of resident, the semigrant executive. They are primarily C-suite professionals, often 50 or older, who have chosen not to live in Durban or Cape Town.
This is due to the lifestyle on offer, which includes cycling, trail running, surfing, and year-round golfing in a subtropical climate, as well as proximity to an international airport.
“KZN’s north coast has positioned itself as the lifestyle choice for the value-conscious executive, offering a compelling quality-of-life proposition at a fraction of Cape Town’s costs,” said Standard Bank.
As the northern coast expanded, two large office parks, Umhlanga Ridge and La Lucia Ridge, emerged, attracting a large group of corporates from the CBD, which was becoming unsafe.
The investment patterns of KZN elites have been dominated by the demand for high-end residential property, especially within gated lifestyle estates.
Suburbs including Umhlanga and Ballito have become premier destinations, with luxury, lock-up-and-go apartments and sectional-title properties commanding major premiums over freehold homes.
Loading ...