As homebuyers across the globe grapple with soaring property prices and rising interest rates, South Africa has emerged as the most affordable country in the world to purchase a home in 2024, according to a comprehensive international study by BestBrokers.
The analysis, which compared real estate prices and average income levels across 62 countries, offers a striking perspective on the contrasting challenges and opportunities facing prospective homeowners.
The report finds that in many countries, particularly those with struggling economies or runaway inflation, owning a home is becoming a distant dream for most residents. In contrast, some nations with strong average incomes and relatively stable property markets are seeing more favorable conditions for buyers.
One of the most striking insights is that the affordability of housing is not solely dependent on the cost of real estate but also on how that cost compares to average earnings.
For instance, Turkey was ranked as the least affordable country to buy a home in 2024, with a staggering home price-to-income ratio of 81.45%. Despite relatively low property prices, Turkey’s high inflation rate—estimated at 55% year-over-year—and low average income ($549/month) have made home ownership increasingly unattainable.
In South Korea, another country in the bottom 10 for affordability, the challenge is different: extremely high property prices averaging $10,318 per square metre make it difficult for even middle-income earners to enter the market.
At the opposite end of the spectrum, South Africa stands out as the most affordable country for homebuyers, with a home price-to-income ratio of just 6.22%.
This means that, on average, South Africans need only about six years’ worth of salary to afford a home—a sharp contrast to countries like Nepal or Turkey, where buyers would need to save for more than five decades.
Measured in monthly wages, a 100-square-metre home in South Africa costs just 71 real monthly salaries, compared to 76 in the United States, which ranked second in global affordability.
This translates into just under six years of income—an impressive figure in a world where housing costs have become a key source of economic stress.
At the extreme end, in countries such as Nepal and Turkey, the same-sized home would require 684 and 631 monthly salaries, respectively—equivalent to more than five decades of income.
These figures highlight the impact of low wages and high inflation on housing markets in lower-income or highly volatile economies.
Why Is Housing So Affordable in South Africa?
-Several factors contribute to South Africa’s strong showing in the rankings:
-Comparatively low property prices: As of late 2024, the average cost of residential property in South Africa is significantly lower than in many developed countries, especially in non-metropolitan areas.
-Stagnant but stable income levels: While wage growth has not kept pace with inflation in some sectors, average income still holds up reasonably well in real terms.
Regulated lending environment: Although mortgage interest rates remain a challenge for some borrowers, South Africa’s structured and cautious lending environment has helped avoid the kind of runaway debt that often pushes affordability down in other countries.
While South Africa’s leading affordability position is notable, the study emphasizes that affordability doesn’t mean uniform access. Factors such as interest rates, lending policies, and location-specific price variations still play a major role in the actual accessibility of housing for individuals.
Despite these complexities, South Africa’s ranking suggests that, in global terms, the country remains a more accessible place for aspiring homeowners compared to most. Whether this can be sustained will depend on broader economic stability, policy support for affordable housing, and continued wage growth.
