Based on average house prices, one would need to earn between R33,000 and R76,500 per month to afford to buy a home in South Africa’s best-rin municipalities.<\/p>\n\n\n\n
Recent assessments by Ratings Afrika have highlighted Mossel Bay and Midvaal as South Africa’s top-performing municipalities. <\/p>\n\n\n\n
They used a scoring system that evaluates six critical factors: operating performance, liquidity management, debt governance, budget positioning, affordability, and infrastructure development. <\/p>\n\n\n\n
These municipalities scored impressively, with both achieving 74 out of 100 in terms of financial sustainability. <\/p>\n\n\n\n
Three additional Western Cape municipalities\u2014Saldanha Bay, Swellendam, and Swartland\u2014also ranked highly, securing scores between 71 and 73.<\/p>\n\n\n\n
The Mossel Bay Municipality has been recognised for its consistent performance and high levels of financial management, and it is sharing the top spot with Midvaal. <\/p>\n\n\n\n
Mossel Bay has demonstrated strong fiscal discipline and sustainable development, which contribute to its positive reputation. <\/p>\n\n\n\n
Midvaal, located just south of Johannesburg, stands out as Gauteng\u2019s only municipality to receive a clean audit from the Auditor-General (AG), a distinction it has maintained for an impressive 10 consecutive years. <\/p>\n\n\n\n
Midvaal\u2019s achievement is particularly noteworthy as only 34 municipalities nationwide earned clean audits in the latest review, with 20 of these located in the Western Cape, including Mossel Bay.<\/p>\n\n\n\n
House prices and affordability in these well-managed municipalities vary significantly. <\/p>\n\n\n\n
According to data from Property24, Mossel Bay has seen 1,847 home sales in 2024, with an average selling price of R2.15 million. <\/p>\n\n\n\n
Housing prices in Mossel Bay span a wide range, from approximately R1.72 million for a one-bedroom apartment to as much as R5.5 million for larger properties with five or more bedrooms. <\/p>\n\n\n\n
By contrast, Midvaal remains considerably more affordable. <\/p>\n\n\n\n
In 2024, there have been 696 property sales, with an average price of R940,000. Prices in Midvaal range from R660,000 for smaller one-bedroom apartments to about R2.7 million for more spacious full-title homes with five or more bedrooms.<\/p>\n\n\n\n
How much you need to earn <\/strong><\/p>\n\n\n\n When evaluating how much one would need to earn to buy property in these areas, financial experts recommend a rule of thumb that mortgage payments should not exceed 30% of the borrower\u2019s gross monthly income. <\/p>\n\n\n\n Richard Gray, CEO of Harcourts South Africa, explains that banks typically prefer lending to buyers within this income threshold, ensuring that home loan payments do not overextend borrowers’ finances. <\/p>\n\n\n\n This 30% standard is upheld by many financial institutions, including SA Homeloans, which generally will not approve a loan if repayments surpass this percentage of a borrower\u2019s income.<\/p>\n\n\n\n Gray emphasizes the importance of this threshold for maintaining financial balance, allowing homeowners to manage other expenses and build savings while repaying their loans. <\/p>\n\n\n\n Adhering to this guideline allows borrowers to make additional payments on their home loan when possible, which can significantly reduce the loan\u2019s overall cost and shorten the repayment term.<\/p>\n\n\n\n Using this 30% income threshold, BusinessTech has estimated the income needed to afford homes in both Mossel Bay and Midvaal. <\/p>\n\n\n\n For the average home in Midvaal, with a cost of R940,000, an income of approximately R33,413 per month or R400,956 per year<\/strong> would be needed to comfortably manage the monthly bond repayments.<\/p>\n\n\n\n In Mossel Bay, where the average home price is much higher at R2.15 million, a prospective homeowner would need to earn around R76,430 per month or R917,160 annually.<\/strong><\/p>\n\n\n\n These calculations assume a 20-year mortgage with no down payment at the current interest rate of 11.5%.<\/p>\n\n\n\n These figures underscore the affordability gap between South Africa\u2019s top municipalities, shaped by their differing housing markets. <\/p>\n\n\n\n While Midvaal offers a more accessible entry point for homeownership, Mossel Bay’s high property prices reflect the desirability and robust financial management of the area. <\/p>\n\n\n\n For prospective homeowners, these two municipalities represent contrasting options, both boasting strong governance and infrastructure, yet catering to different income brackets and lifestyle preferences.<\/p>\n\n\n\n
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