The current landscape of property investment

SOUTH African property has always been more than just an investment for most of us.

- HARRY SCHERZER

It represents security. A tangible asset you can see and touch, and for many, the cornerstone of family wealth. This deep attachment to property ownership has shaped how South Africans build their portfolios for generations. But the past five years have challenged many of the assumptions we've held about property as a reliable wealth creator.Interest rates soared, the rand weakened, and entire neighbourhoods saw their character transformed by people moving between provinces. If you own property or you're considering buying, the question isn’t simply whether property is good or bad, it’s whether property still makes sense for your specific situation, especially when compared to what’s happening in global real estate markets.

The numbers from 2020 to 2025 paints an interesting picture. South African residential property prices rose about 38% in nominal terms over these five years. That sounds impressive until you account for inflation, which ate away at much of that gain. In real terms, house prices increased just 1% in 2023 and 1.2% in 2024 after adjusting for inflation.

The recovery came in 2025, with house prices growing 5.2% year on year as of March, according to Statistics South Africa. This improvement followed interest rate cuts by the Reserve Bank and reduced political uncertainty after the formation of the Government of National Unity. For homeowners who weathered the tough years, 2025 brought some relief.

But when you compare South African property to what’s happening globally, the picture becomes more complex. The FTSE EPRA Nareit Global Real Estate Index shows that global real estate returned 11.04% in 2025. South African property hasn’t kept pace with these global benchmarks, particularly when you factor in currency movements and the reality that we don’t have the same depth of liquid, tradeable property investments that international markets offer.

Residential versus commercial: two different stories