The Gauteng property market has shown a strong recovery, attracting many South African expats back home, according to Lew Geffen Sotheby’s International Realty.
While the initial improvement in early 2024 was mainly seen in increased enquiries, significant progress began after the elections, with the post-election recovery anticipated by July 2024.
“Driven by a generally positive sentiment regarding the expected market and political improvements in South Africa in an election year, the increased market activity we saw earlier in the year wasn’t unexpected,” said Cobus Odendaal, CEO of Lew Geffen Sotheby’s International Realty in Johannesburg and Randburg.
“However, the market’s resurgence post-election has been more dynamic than anticipated. In July, the turnover at our Randburg office tripled what it had been in previous months, and in Craighall, the monthly turnover doubled.
“This not only signals renewed confidence among buyers and investors in Johannesburg, but also reflects the first solid signs of restored confidence in the local market by local buyers, with Johannesburg naturally leading this revival.”
Odendaal noted that many people who sold their properties in the past two years to liquidate their assets are now returning to the market to purchase, with a surprising number being cash buyers.
“Homeowners who sold their properties and chose to rent before making any final decisions are now returning to the market,” said Odendaal.
“These funds can be used to purchase property again, which signals a renewed confidence in the South African economy and a desire to invest in long-term assets.”
“Having said that, we are still experiencing healthy activity in the more affordable rental market with demand still high for homes priced between R8,000 and R35,000 per month, but demand has declined noticeably for properties priced higher, and it seems to be limited to specific areas and corporate rentals.”
He added that there has been a spike in enquiries from people who sold up to move abroad and foreign buyers.
“We’ve started to receive enquiries from expats looking to move back and buy property again, which is very encouraging.”
In February, Lew Geffen Sotheby’s International Realty noted that expatriates who once sought greener pastures abroad were heading home in increasing numbers. Agents in areas such as Cape Town’s Southern Suburbs pointed to a spike in inquiries.
Stephan Thomas and David Burger, Secure Estate Specialists for Lew Geffen Sotheby’s International Realty, sid that, “Over and above the wave of semigration to the Cape and the growing interest of high-net-worth foreign investors, we’ve seen a notable increase in enquiries from expats.”
They added that, “Many of these buyers left South Africa in their teens or in their early 20s, are now in their 30s and 40s with families of their own and are keen to return for a number of reasons, including lifestyle and the advantageous exchange rates that enable them to leverage their foreign-earned currency.”
“Others are retirees looking to escape the harsh European winters to enjoy their golden years in a temperate climate where they can pursue outdoor leisure activities and their hard currency pensions will stretch that much further.”
One of the most significant drivers behind expats’ return to South Africa is indeed the advantageous exchange rates that enable them to maximise the purchasing power of their foreign-earned currency.
“With currencies like the US dollar, British pound, and euro continually strengthening against the South African rand, expatriates find themselves in a favourable position to invest in property and capitalise on attractive opportunities,” sid Thomas and Burger.
Lifestyle is the other key driver, and Cape Town’s Southern Suburbs are especially appealing, as not only are many of the city’s best schools located in the area, residents are spoilt for choice when it comes to leisure activities and sports facilities, from beautiful beaches nearby to golf courses and restaurants.
These days, many people living in the UK and Europe also feel burdened by social issues specific to these areas. In Burger and Thomas’ view: “The other reality is that people living in the UK and Europe are becoming more miserable every day with wars on their doorstep, uncontrolled immigration and cost of living increases and, at the end of the day, we all aspire to a better lifestyle and will seek it out.”
Another compelling drawcard in South Africa is that buyers have a wide choice of property options, particularly in the secure estate sector.
“Estate properties are very popular with these buyers and estates in this area offer everything they need, including controlled access, first-class lifestyle amenities and a sense of community, as well as property options to suit most budgets. Although we find that our expat clients generally purchase within two price bands – R9 million to R18m, and R25m plus.”
Despite the country’s enduring economic and political challenges, South Africa still boasts pockets of resilience. Growth potential and burgeoning sectors such as technology, renewable energy, and tourism offer ample opportunities for entrepreneurial ventures and career advancement.
“For many expats, reconnecting with their roots and embracing their cultural heritage is a compelling motivator for returning to South Africa,” add Burger and Thomas. “And the sense of belonging, community, and identity they experience fosters a profound emotional connection, prompting them to rediscover and contribute to the nation’s social fabric.”
Komentarze