23-06-2025
Why the Western Cape property market is thriving: Insights and trends
Cape Town's property market continues to outpace other regions.
Image: Ayanda Ndamane
The Western Cape property market continues to outperform other regions by a significant margin, particularly within the Cape Town metropolitan area, and experts believe this trend is likely to continue.
Lightstone data shows that Western Cape property prices grew by 8.7% in the year to January 2025, compared to the national average of 5.2%.
According to The African Investor, Cape Town residential properties, in June 2025, showed year-on-year price growth of 8.5%. Moreover, Cape Town boasts an average prime property price of R31,000 per square, which is more than double Johannesburg's figure of R14,000.
Particularly telling is that the Western Cape accounted for more than 38% of national real estate transaction value in 2024, according to Stats SA, despite having just 11% of the population.
'This concentration of capital speaks volumes about where investors are placing their confidence,' says Arnold Maritz, of international realtor Lew Geffen Sotheby.
This is especially evident in the luxury segment.
'In our office, buyers with budgets exceeding R15 million have become the norm rather than the exception. We repeatedly see clients inquiring about specific properties, only to learn they were sold within days - sometimes hours - of listing. The speed at which quality stock moves in these neighbourhoods is remarkable,' Maritz explained.
He added that buyers also displayed a growing appetite for luxury residential estates in the Southern Suburbs, with buyers being drawn to their combination of space, privacy and proximity to top schools and the CBD.
Why Cape Town property prices are outpacing other cities
The reasons for Cape Town's property boom are numerous, and now include greater comparative incomes.
According to the latest figures from Stats SA, Cape Town's average household income of around R387,000 per year is higher than any other city in the country, with Johannesburg trailing at R282,000.
Cape Town's unemployment rate of 23.4% is also well beneath the national average, and the nature of employment also differs markedly. For instance, formal sector jobs in the Western Cape grew by 3.1% in 2024, versus 1.2% nationally.
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The so-called 'semigration' trend is playing a significant part in driving up property prices in the region. Stats SA reveals that the Western Cape experienced a net migration of 92,000 working age adults in the past two years, with some 68% holding tertiary qualifications and 42% occupying professional or managerial roles.
But will the bubble burst anytime soon?
'As with any strong market, questions arise about sustainability. Yet most indicators suggest Cape Town's growth has firm foundations,' Lew Geffen Sotheby's commented.
According to an FNB Property Insights report, economists are predicting a 7-9% annual price growth in their base case scenarios, with potential for 10-12% in the prime segment.
Lightstone says the 'undersupplied' market continues to present opportunities, particularly in the Southern Suburbs, where areas like Bishopscourt, Constantia, and Claremont have seen significant yields.
Cape Argus
