Home in on a bargain — areas in SA’s property market that still offer value for money, growth

Some areas in South Africa have bucked the country’s general housing market malaise. These areas are considered investment gems by property players because they have recorded house price growth that has kept up with inflation, or in some cases, exceeded it.

Mortgage originator ooba has recorded an average 2.2% increase in national house prices during the second quarter of 2024, compared with the same period in 2023. Unsur­prisingly, the Western Cape is the only region to see healthy growth. Before adjusting for the inflation rate, the province recorded growth of 6.3%, or nearly 2% after inflation.

The Western Cape was followed by Limpopo, the Free State, the Eastern Cape, and the eastern and southern parts of Gauteng. KwaZulu-Natal was the worst-performing province in the second quarter, with a price drop of 7.2%. Other regions where prices fell include Joburg, the West Rand, Tshwane, North West and Mpumalanga.

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Given the disparities in house price performance around South Africa, Daily Mave­rick canvassed the views of several industry players about where to buy a property that offers value for money and good house price growth potential. This would be for first-time or repeat home buyers, who earn a monthly income of between R40,000 and R80,000. Ideally, the buyers could afford a property worth not more than R2-million (a sweet spot, as this is where most home-buying activity is) – assuming they secured a 100% mortgage.

Adrian Goslett, the CEO of RE/MAX of Southern Africa, said Gauteng’s Centurion was consistently highlighted as a great place for first-time buyers and investors. “The area has seen steady house price growth, especially in security estates, and still offers value for money compared with other areas in Gauteng,” said Goslett.

Samuel Seeff, the chairman of the Seeff Property Group, supported Goslett’s views, saying areas close to Centurion were sought-after, including Midrand, Pretoria East and further away in Hartbeespoort, where townhouses and freestanding houses can easily be snapped up for under R2-million.

In the province, there is also Johannesburg, which Seeff has not written off despite its challenges, such as poor service delivery and crime, that have pushed many to the Western Cape. Seeff said areas near Sandton, including Douglasdale, Sunninghill and Bryanston, still offered value. He said buyers needed to take a long-term view that Johannesburg might one day turn around.  

“There are certain ‘golden rules’ to look out for if your aim is to ensure your property will grow in value.

“These include buying in a good location which has good infrastructure, is relatively secure and has good amenities, and ensuring that the price you pay is in line with the current market,” said Seeff.

Herschel Jawitz, the CEO of Jawitz Properties, also advised buyers to choose wisely when settling for an area and consider factors that will create long-term demand and price growth. “Factors such as proximity to ‘live, work, play’ nodes, good schools, and security all play a part in driving demand and price growth.” 

While house price growth has been depressed in Johannesburg, Jawitz  said buyers entering the market are now buying at prices as far back as 2014. This means the city currently offers value for money. For up to R2-million, Jawitz said that in parts of Johannesburg such as Marais Steyn Park (east of the city) and Lonehill near Sandton, buyers can easily snap up a free-standing home, boasting as many as four bedrooms, and a pool in a gated community.



Chareen Mota, a Gauteng manager at Pam Golding, said areas such as Alberton and Johannesburg South still offered good va­lue for money, especially for sectional title units and large stands.

Industry players believe that many parts of KwaZulu-Natal are undervalued, as seen in flat or even declining house prices over the past three years.

Gareth Bailey, the Pam Golding Properties area principal for Durban Coastal, said the decline meant there was more scope for growth in house prices and that homes were relatively more affordable than in areas such as the Western Cape.

Many would-be buyers have taken a dim view of the province given poor service delivery, riots and floods in recent years. Bailey said, in the below R2-million category, areas such as Durban North and uMhlanga still offered value, and freestanding homes have generated “positive returns in the longer period”.

In the Western Cape, suburbs like Brackenfell and Kuils River have been growing in popularity because of their relatively affordable prices compared with central Cape Town. Said Goslett: “These areas have seen strong demand from families and first-time buyers, leading to solid capital appreciation.”

Jawitz supported Goslett’s views, saying there are several areas outside central Cape Town that currently offer value. “Buyers, especially in the current market, are very value-driven, and look to buy more property for the same price or the same property for a lower price. However, value doesn’t always create growth,” he said. 

Areas in the Cape that may offer better growth and value include the northern suburbs of Cape Town such as Kraaifontein, Kuils River and Paarl in the heart of the winelands, said Jawitz. In these areas there is housing stock comprising three-bedroom homes with a R1.5-million valuation.

Gqeberha areas such as Summerstrand, Humewood, Walmer and Salisbury Park still offer townhouses for under R2-million. The industry players agree most areas in the Free State, Limpopo and Eastern Cape are also undervalued, offering an affordable entry point into the housing market. DM

This story first appeared in our weekly Daily Maverick 168 newspaper, which is available countrywide for R35.