South Africa’s property market is experiencing its strongest consumer confidence in a decade, signaling a positive outlook for homeowners, buyers, and investors.
According to Absa’s latest Homeowner Sentiment Index, which surveys over 1,200 income-earning participants from metropolitan areas, cities, and towns, sentiment around residential property climbed to 87% in the final quarter of 2024—the highest level in ten years.
The study indicates a growing preference for homeownership, with 77% of respondents favoring buying over renting, an increase of 4% from the previous quarter. The trend is largely fueled by the belief that owning property is more beneficial than renting.
First-Time Buyers Driving the Market
A major contributor to the surge in confidence is the dominance of first-time buyers, who are making up a significant share of market activity. Absa’s data shows that this group accounted for 53% of property registrations in 2024.
“First-time buyers continue to drive market activity, and we anticipate further growth in this segment as affordability improves,” said Nondumiso Ncapai, Managing Executive at Absa Home Loans.
The positive sentiment among first-time buyers is supported by expectations of interest rate cuts, with one 25 basis point (bps) reduction in January 2025 and another expected in March. Lower interest rates will ease affordability and stimulate further demand for homeownership.
Investment and Selling Confidence on the Rise
South African consumers are also increasingly confident about property investment, with sentiment rising by 5% quarter-on-quarter to 85%—the strongest growth among all measured metrics.
Absa attributes this to investors seeing a window of opportunity to expand their portfolios as the economy stabilizes.
Selling sentiment has also improved, surpassing the 50% mark for the first time in two years. The number of sellers increased in the final quarter of 2024, with some homeowners opting to liquidate properties to free up funds.
House Prices and Market Outlook for 2025
Several indicators suggest continued growth in South Africa’s real estate market:
- The Absa House Price Index is showing positive movement, supporting a gradual recovery into 2025.
- Market optimism remains high, even as consumers recover from a prolonged cost-of-living crisis.
- Political and economic stability within the government of national unity could provide further momentum.
“While we continue to monitor geopolitical and economic developments, we remain optimistic about the prospects for South African consumers and businesses in the real estate environment,” said Ncapai.
With strong buyer sentiment, increasing investment confidence, and improving affordability, South Africa’s property market is set for one of its most promising years in a decade.
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