Over the past five years, South Africa’s residential property market has seen an average price increase of 23.8%, with some provinces significantly outpacing this national growth rate, Cape {town} Etc reports.
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StatsSA’s latest Residential Property Price Index (RPPI) for Q1 2024 shows a 3.5% national increase in residential property prices over the past year.
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According to BusinessTech, the RPPI, based on data from the Office of the Chief Registrar of Deeds, tracks price changes for houses, townhouses, and flats at national, provincial, and metropolitan levels.
The Western Cape led the provinces in property price growth, with residential values surging by 7.7% between March 2023 and March 2024.
North West followed with a 5.0% increase, while Mpumalanga recorded a modest 2.3% rise.
However, not all regions saw gains—property prices in the Northern Cape dropped by 4.8%, and Limpopo experienced a 2.3% decline.
Gauteng, South Africa’s economic hub, saw only a slight 0.7% increase.
Over the broader five-year span from 2019 to 2024, the national RPPI indicates a cumulative property price increase of 23.8%, averaging an annual rise of 4.8%.
The Western Cape once again led the pack with a substantial 35.5% increase, while the Northern Cape lagged with only 0.9% growth.
Gauteng’s property prices rose by 16.4%, falling below the national average.
These trends are indicative of the influence of regional factors on property markets, with the Western Cape consistently outperforming other provinces in price growth.
The table below illustrates the performance of property markets across South Africa’s nine provinces, showing what a R1 million house purchased in 2019 would be worth in 2024.
While property prices have risen across South Africa, this doesn’t tell the full story.
When adjusted for inflation, the national value of properties has actually decreased by 3.9%, with inflation recorded at 27.7% over the same period.
A property’s price reflects the amount paid at a specific time, influenced by demand, location, and market conditions.
However, when adjusting for inflation, the real value accounts for changes in the cost of goods and services over time.
For example, a house bought for R500,000 ten years ago and now worth R700,000 may seem to have appreciated, but inflation means its real value hasn’t increased as much.
In this context, property values in Mpumalanga have remained flat since 2019, while those in the Western Cape have seen a real increase of 7.8%.
All other provinces have experienced a decline in real value.
The Q2 2024 Oobarometer report from Ooba Home Loans echoed this trend, showing marginal nominal price growth of 2.3% nationally and 2.7% for first-time homebuyers year-on-year.
Despite these nominal gains, real property price growth remains negative due to high inflation.
Experts attribute the Western Cape’s unique real price growth to strong service delivery and investment in the region, setting it apart from other provinces.
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