{"id":806888,"date":"2025-01-16T16:00:00","date_gmt":"2025-01-16T14:00:00","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=806888"},"modified":"2025-01-16T16:51:11","modified_gmt":"2025-01-16T14:51:11","slug":"goodbye-cape-town-new-semigration-shift-hitting-south-africa","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/property\/806888\/goodbye-cape-town-new-semigration-shift-hitting-south-africa\/","title":{"rendered":"Goodbye Cape Town – new semigration shift hitting South Africa"},"content":{"rendered":"\n

The appetite for semigrating to Cape Town appears to be dying down.<\/p>\n\n\n\n

Rising costs, congestion, and other challenges have meant that locals are increasingly looking elsewhere to purchase their homes.<\/p>\n\n\n\n

As such, it is predicted that homeownership demand in the country’s economic hub, Gauteng, will rebound \u2013 with early data already pointing to this.<\/p>\n\n\n\n

These are the views of Rhys Dyer, CEO of the ooba Group, who said that the third quarter of 2024 “signalled a significant turning point for the residential property industry, generating momentum that will fuel growth well into 2025.”<\/p>\n\n\n\n

He said that in October 2024, the market responded swiftly to the first interest rate cut of 25 basis points, with ooba Home Loans reporting year-on-year and month-on-month volume increases of 16% and 27%, respectively.<\/p>\n\n\n\n

\u201cSpurred on by factors such as additional interest rate cuts, better economic prospects, improved affordability and more stability, we strongly believe that demand for property in 2025 will reach levels exceeding those seen in recent years,\u201d said Dyer.<\/p>\n\n\n\n

Looking at trends expected in 2025, a notable prediction is for the Western Cape semigration frenzy, particularly to cities like Cape Town, to taper off.<\/p>\n\n\n\n

Dyer pointed out that the latest data from Stats SA revealed a notable decline in approved building plans for the City of Cape Town.<\/p>\n\n\n

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Source: StatsSA<\/figcaption><\/figure><\/div>\n\n\n

Meanwhile, a high concentration of high-value activity is taking place in sought-after coastal towns like Knysna.<\/p>\n\n\n\n

\u201cKnysna and other smaller, more affordable coastal towns like George are on a sharp upward trajectory that is set to gain momentum in 2025,\u201d said Dyer.<\/p>\n\n\n

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Source: StatsSA<\/figcaption><\/figure><\/div>\n\n\n

The ooba CEO said \u201cCape Town\u2019s downward trend is largely driven by rising costs, congestion and challenges like long school waiting lists.\u201d<\/p>\n\n\n\n

Lightstone\u2019s data supports this, illustrating a drop off in Western Cape semigration in the first half of 2024 compared to the peak of the movement in 2022.<\/p>\n\n\n\n

A 2024 Lightstone Property report reveals that 1 in 4 homeowners selling and buying a new home move to another province. <\/p>\n\n\n\n

Gauteng and Western Cape dominate, comprising 48% and 23% of the market, respectively. <\/p>\n\n\n\n

ooba Home Loan\u2019s figures echo this, showing a turnaround in the growth of house prices in both Tshwane and Johannesburg from April 2024, signalling the speculative return of homeownership demand to the country\u2019s economic hub.<\/p>\n\n\n\n

FNB\u2019s Q4 2024 Estate Agent Survey also highlights this, with the most significant marked improvement in housing market activity taking place in this region.<\/p>\n\n\n

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Source: ooba Home Loans<\/figcaption><\/figure><\/div>\n\n\n

One of the country\u2019s largest developers, Balwin Properties, reported that Gauteng regained its position as the company\u2019s top revenue contributor by region at 49% (financial results ending August 31, 2024).<\/p>\n\n\n\n

Other property trends<\/h2>\n\n\n\n

Despite market fluctuations, Dyer said that banks continue consumer-friendly lending, offering attractive prime rate discounts in December 2024, with the national average at prime less 0.55%, up from 0.44% in 2023. <\/p>\n\n\n\n

The Western Cape led with the highest average concession at -0.84%. Loan-to-value (LTV) ratios peaked at 86.7% in August but ended the year at 83.6%, with the Western Cape and Johannesburg having the highest approval rates.<\/p>\n\n\n

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Source: ooba Home Loans<\/figcaption><\/figure><\/div>\n\n\n

Additionally, first-time homebuyers showed improved financial prosperity, with deposits averaging 9.9% in Q4 2024, and zero-deposit bonds are expected to return in 2025.<\/p>\n\n\n\n

Thus, first-time homebuyer demand rose, with applications increasing from 45.2% to 46.9% by December 2024, driven by lower interest rates. <\/p>\n\n\n\n

The Free State, Mpumalanga, and Gauteng South & East saw the highest demand in this respect. <\/p>\n\n\n\n

First-time homebuyers\u2019 average purchase price rose 5.2% year-on-year to R1.19 million, with the Western Cape seeing the largest increase at 9.3%.<\/p>\n\n\n

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Rhys Dyer, CEO of the ooba Group.<\/figcaption><\/figure><\/div>\n\n\n

ooba Home Loans\u2019 data also indicates steady growth in the self-employed category, with applications increasing to 14% in Q4 \u201924 (up from 13% in Q4 \u201923). <\/p>\n\n\n\n

\u201cInterestingly, self-employed buyers accounted for 21% of the total application value in December \u201824, reflecting growing economic confidence and increased investment activity in this segment,\u201d said Dyer.<\/p>\n\n\n\n

According to UN Trade Development, there are currently around 3 million SMEs in South Africa, with around 70% of these operating in the informal sector. <\/p>\n\n\n\n

\u201cWe believe that bank lending conditions, coupled with a positive outlook, will bode well for demand in this segment, which has already shown remarkable progress over a short space of time,\u201d said Dyer.<\/p>\n\n\n\n

Overall, Dyer says that they believe that the above-mentioned prevailing trends will continue into 2025.<\/p>\n\n\n\n

“We look forward to the positive impact that further rate cuts will have on the market this year as our industry gears up for high levels of growth and activity,\u201d he said.<\/p>\n\n\n\n

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Read: South Africa sitting on a \u2018gold mine\u2019 for jobs and economic growth<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Property experts say that that the ‘frenzy’ of semigrating to Cape Town may be tapering off.<\/p>\n","protected":false},"author":101,"featured_media":805975,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12755],"tags":[2279,1652,16430,21425,20721],"class_list":["post-806888","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-property","tag-cape-town","tag-gauteng","tag-ooba-group","tag-ooba-home-loans","tag-semigration"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/806888","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/101"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=806888"}],"version-history":[{"count":10,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/806888\/revisions"}],"predecessor-version":[{"id":807210,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/806888\/revisions\/807210"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/805975"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=806888"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=806888"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=806888"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}