Jo’burg property market blossoms this Spring
The arrival of Spring is bringing more than just warmer weather to Johannesburg – it’s also ushering in one of the strongest home buying seasons the city has seen in years, with activity levels rising sharply and many sellers set to reap the benefits of faster sales in the coming months.
So says Stephen Whitcombe, MD of leading Johannesburg property group FIRZT Realty, who notes that the group’s sales have increased every month since the start of 2025, and that with the effects of five interest rate cuts over the past year now really starting to improve household finances, all the signs point to a bumper Spring and Summer season.
“Buyer interest in Johannesburg has really accelerated in recent months, with our agents reporting more show day traffic, stronger offers and faster conversions into sales than at any time since before the pandemic,” he says. “In fact, the pace of sales is already heading back towards what we saw during the mini-boom of 2021, and we are entering what is traditionally the busiest quarter of the year.
“As it is, the latest statistics from mortgage originator BetterBond show a 12% year-on-year increase in the number of home loan applications, which is now at its highest level since late 2022, when interest rate increases started to limit affordability.
“Significantly, average home selling prices are now also starting to show real (after inflation) growth for the first time in many years. The latest FNB Residential Property Barometer shows that freehold home prices showed year-on-year growth of 3,7% in July, and sectional title homes 3,8% growth, compared to the official inflation rate for July of 3,5%.”
He notes that while value growth in the Western Cape has been way ahead of inflation for several years and currently sits at around 9% a year, value growth in Greater Johannesburg only turned positive in August 2024 after several years of stagnation, but is now rapidly gathering momentum as the inventory of homes for sale steadily shrinks, especially in the sectional title market.
“This sector is now not only the favourite of first-time buyers and young professionals seeking urban homes close to work, but also of seniors downsizing from family homes, foreign and expat executives seeking a part-time base in the city and the rising number of buy-to-let investors.
“But development of new sectional title units for sale is lagging demand quite badly. The latest building statistics from StatsSA show that a total of 5472 new flats and townhouses were completed nationally during the first half of this year, which was 16% more than in the same period of 2024, with the Western Cape (2606), Gauteng (2252) and KZN accounting for most of these.
“However in Johannesburg, the bulk of apartment development at the moment is being undertaken by corporates who are converting underused office blocks and intend to retain the units for rental only. And in the Western Cape, which would appear from the number of cranes on the skyline to be undergoing a development boom, most of the units currently being built are in projects planned several years ago and delayed until now for various reasons.”
And an ongoing shortage of supply for the foreseeable future, Whitcombe says, is indicated by the fact that the number of building plans passed nationally for flats and townhouses in the first half of this year is 20,4% down on the number passed in the same period of 2024, with the number passed in Gauteng being a whopping 39,9% down and that in KZN 29,2% down.
“What is more, the number of plans passed in the Western Cape was only 3,1% up on last year, so there is not much more in the pipeline there, and the overall picture is one of constrained supply that will support rising prices.”
The main factors underpinning the current upturn in buying activity, he says, include relatively low inflation, SA’s political stability and growing safe haven status in the world, and ongoing consumer confidence in the property market. “The most recent Absa statistics show, for example that overall homeowner sentiment rose from 85% positive to 86% in the second quarter of this year, while investor sentiment was 84% positive.
“Another factor fuelling the market is the steady return of corporates and employees to offices in and around Johannesburg’s commercial hubs, and of course this season is one when many families are starting to plan a move closer to a new job or career opportunity in January, or so that they can live closer to a new school or university their children will be attending.
“And finally, Johannesburg’s average home prices are still very competitive compared to other metros. This fact, plus rising international interest in the city ahead of the G20 summit in November, is also getting the attention of foreign investors and helping to set the stage for some bumper sales months ahead.”