Townhouse or standalone house? Here is what and where 30-year-olds are buying

The Citizen

20-05-2025

First-time buyers opt for freehold homes as their primary residence, while sectional title homes are used as an investment or buy-to-let properties.
First-time buyers, especially young adults, often opt for sectional title properties as their first homes because they are convenient. Sectional title properties are a form of ownership where a building or complex is divided into individual sections, like apartments, townhouses and common areas.
However, data from Ooba Home Loans shows that interest from first-time buyers in buying freehold homes has not declined significantly. Freehold ownership means you own both the land and the building on it, giving you full control over the property. This includes the freedom to renovate, extend or modify the property, often with minimal restrictions beyond local zoning regulations.
Andrew Golding, chief executive of the Pam Golding Property group, says the percentage of freehold homes purchased by first-time homebuyers has remained relatively stable, declining from 70% in 2014 to 66% in 2024.
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Which home do you prefer?
Freehold homes and sectional title properties have different benefits, and it depends on what the buyer is looking for.
Golding adds that first-time buyers opt for freehold homes as their primary residence, while sectional title homes are used as an investment or buy-to-let properties.
'In 2014, there was a slight preference for freehold homes, 52% of first-time buyers' investment purchases, but by 2024, sectional title purchases dominated at 60% of all first-time buyers' investment purchases.'
Which type of home is an investment?
He adds that many first-time buyers are embracing the national trend towards acquiring investment properties or buy-to-let properties.
'Increasing demand from first-time buyers has resulted in a real (inflation-adjusted) increase in the average price paid by those purchasing their first property during the first four months of the year.
'During the first four months of 2025, the national purchase price for homes in South Africa averaged R1.66 million, reflecting an increase of 2.7% compared to the same period last year.
'Notably, during the same four-month period this year, the average price paid by first-time buyers was R1.245 million, which shows an increase of +4.7% compared to year-earlier levels.'
Difference in home prices
Golding says that in 2014, a first-time buyer purchasing an investment property paid almost the same for that property, regardless of whether it was a freehold home (R1.045 million) or a sectional title (R1.026 million).
First-time buyers who opted for freehold homes purchased the more expensive ones, with the average price paid increasing by 111% over the past decade to an average of R2.21 million in 2024.
This compares to an increase of just 42.1% over the same period, with an average purchase price of R1.46 million in 2024 for first-time buyers' sectional title purchases bought as investment or buy-to-let properties.
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Decline in buying with a spouse
Data shows a decline, from 34% in 2014 to 27% in 2024, in the percentage of people buying houses with a spouse.
However, purchasing with another person has risen from 14% to 18% – perhaps reflecting those buying a home with a partner, family member or friend instead of a spouse.
Golding adds that 64% of their first-time buyers do not have dependents. 'However, there has been a clear increase in those without dependents in the wake of the pandemic, even as the average age of first-time buyers has risen.'
Ages of first-time buyers
He adds that there has been a shift in first-time buyers; those over the age of 43 are the fastest-growing age cohort of first-time buyers, compared to those between 24 and 33 years old.
Nonetheless, the largest age group is between 33 and 43, with a more recent average age of 35.
'Regionally, Ooba Home Loans' statistics revealed that during the year-to-date, demand from first-time buyers was strongest in Mpumalanga (57.3%), followed closely by the Free State (55.9%).
'Gauteng South & East (51.4%) and KwaZulu-Natal (51.2%) were the only other regions in which first-time buyers accounted for more than half of all their applications for home loan finance.'
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Pros of buying sectional title property
According to Betterbond, there are pros and cons of buying sectional title property.
Pros include:
Easier to finance: Before construction commences, developments must be approved by the major banks, so when you then apply for a bond, the process is often quicker and easier.
Body corporate : As the owner of a sectional title unit, you automatically become a member of the body corporate, the legal entity that manages common areas of the property. You pay a monthly levy for a range of services, including conduct rules for residents, building insurance, perimeter security, cleaning, landscaping, and maintenance of common areas, such as gardens.
As the owner of a sectional title unit, you automatically become a member of the body corporate, the legal entity that manages common areas of the property. You pay a monthly levy for a range of services, including conduct rules for residents, building insurance, perimeter security, cleaning, landscaping, and maintenance of common areas, such as gardens. Security: Sectional title property generally offers good entrance and perimeter security. In a freestanding house, you are responsible for installing and maintaining these systems. However, in a sectional title property, the body corporate takes care of it, and the cost is funded through your monthly levy.
Running costs: You pay for municipal rates and taxes, home contents insurance, upkeep of your garden if your unit has such an area, and your own monthly water and electricity consumption. Everything else is pretty much taken care of.
Rentals and resales: Sectional title properties are popular with renters, making them a good option for investors. This also links to resale value, which often improves over time.
Connectivity: Sectional title properties are usually fibre-enabled, so your only expense would be connecting to the existing infrastructure and paying for monthly usage. Working from home is becoming increasingly prevalent, which is a significant advantage.
Cons of buying sectional title property
Communal living : Sectional title property means living close to others, and this could come with a few everyday irritations, like noise.
: Sectional title property means living close to others, and this could come with a few everyday irritations, like noise. Special levies: From time to time, in a sectional title property, there might be a special levy, for example, if the exterior of the building needs painting. However, owners will always be informed of this well in advance, so you will be able to budget for it in good time, and ultimately, it will increase the value of your investment.
Benefits of buying freehold
Nedbank listed a few benefits of buying a freehold home.
You will usually have more space and privacy on a freehold property, with your neighbour's house further away than in a townhouse or block of flats.
You will have more freedom in matters such as exterior decorating or choosing your preferred pets.
You can also determine the level of maintenance and security required for the property, and allocate a budget for these services according to your own priorities.
You can deal directly with the municipality regarding any service issues, instead of relying on the body corporate.
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