Young South Africans are buying fewer homes than they did six years ago, but the houses they do buy are more expensive.
In their new car purchases, they prefer SUVs over other body shapes.
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These are the findings of Lightstone, which provides market research data to the real estate and automotive industries.
It examined property and vehicle sales among working people aged 25 and younger, as well as those aged 26 to 35, from 2018 to 2023, with additional data available as of 2024.
It examined property and vehicle sales among working people aged 25 and younger, as well as those aged 26 to 35, from 2018 to 2023, with additional data available as of 2024.
Residential property sales have fallen across all age groups since 2018, but they have dropped more dramatically among young people, who are typically first-time homebuyers.
Total property purchases fell by 13%, from 294 859 in 2018 to 255 726 in 2023. However, purchases by people aged 26 to 35 fell 25% during that period, from 92 558 to 69 577.
In 2018, the age group accounted for 31% of purchases, which fell to 27% by 2023.
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Buyers aged 25 and under remain low for obvious reasons: few people of that age have the money or earn the kind of salary required to obtain a mortgage bond.
Over the last six years, this age group’s purchase percentage has remained consistent at 4%. The sales fell from 11 480 in 2018 to 8 977 last year.
While sales volumes have decreased, Lightstone’s data show that buyers aged 35 and up are paying increasingly more for their homes. In 2018, 29% of buyers spent between R1 and R3 million.
The percentage grew to 36% by 2023, while young buyers in the R3m+ category increased from 2% to 4%. In contrast, the percentage of houses priced between R250 000 and R500 000 decreased from 34% in 2018 to 25% in 2023.
More than two-thirds (70%) of the buyers are first-time buyers, while the remaining 30% are repeat buyers. Over the past six years, the proportion of first-time to repeat buyers has remained relatively consistent.
According to Lightstone, the five most popular areas for buyers aged 35 or younger over the last year were:
- Impumelelo, a housing development in Devon in the Sedibeng Municipality of Gauteng (857 units sold).
- Sky City, a housing development in Ekurhuleni (446 units).
- Belhar, Cape Town (375 units).
- Erand Gardens, a development in Midrand, Gauteng (341 units).
- Clayville Extension, in Ekurhuleni (298 units).
Lightstone has also identified interesting trends in the car market among people aged 35 and younger.
SUVs and crossover SUVs are the top choice among new vehicle buyers in 2024, despite the fact that the vehicles are significantly more expensive than hatchbacks, which are the second-most popular shape and took the top spot last year.
These two categories account for more than 80% of all purchases made by buyers under the age of 35.
Hatchbacks, on the other hand, continue to be the most popular used-car model, accounting for approximately 45% of all used-car sales to young people.
The SUV/crossover is a distant second, with about 24%, but it is gaining popularity, mirroring the growth of the new market.
Sedans continue to be the third most popular body shape among people under the age of 35, but their market share is shrinking.
The top five most popular car brands have remained unchanged for the past two years.
Volkswagen is the top brand, followed by Toyota, Ford, Suzuki and Nissan. The top five brands account for approximately 65% of all new and used car sales to people under the age of 35.
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