Authored by the expert who managed and guided the team behind the South Africa Property Pack
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What will happen in Johannesburg’s real estate market? Will prices go up or down? Is Sandton still a hotspot for foreign investors? How is South Africa’s government impacting real estate policies and taxes in 2025?
We’re constantly asked these questions because we’re deeply involved in this market. Through our work with notaries, real estate agents, and clients who buy properties in Johannesburg, we’ve gained firsthand insights.
That’s why we created this article: to provide clear answers, insightful analysis, and a well-rounded perspective on market predictions and forecasts.
Our goal is simple: to ensure you feel informed and confident about the market without needing to look elsewhere. If you think we missed the mark or could do better, we’d love to hear your thoughts. Feel free to message us with your feedback or comments, and we’ll work hard to improve this content for you.
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1) Property prices in Johannesburg's inner-city will fall as urban sprawl expands
Property prices in Johannesburg's inner city have been dropping over the past few years.
In 2023, the average property price fell by 10% compared to the previous year, continuing a downward trend that started in 2018. Over five years, this has added up to a cumulative decline of about 20%. Meanwhile, the suburbs are buzzing with activity. Areas like Sandton and Fourways are seeing a boom, with large-scale residential projects announced in 2024. These developments are drawing more people away from the city center.
Why the shift? Suburban areas are becoming more attractive thanks to improved infrastructure and amenities. People are finding these areas more appealing for settling down. The suburbs are not just growing; they're thriving. In 2023, population data showed that suburbs like Randburg and Roodepoort are experiencing higher growth rates than the city center. Residents are flocking to these areas for better amenities and lower crime rates.
Surveys back this up, consistently showing that people prefer the suburbs for an overall improved quality of life. It's not just about the houses; it's about the lifestyle. The inner city, on the other hand, is losing its charm as urban sprawl continues. The trend is clear: Johannesburg's inner-city areas are seeing a decline in property prices as more people opt for the suburban life.
Sources: Lightstone Property Report 2023, JSE Study on Property Prices, Development in Suburban Areas, 2023 Census Data, Nielsen Survey
2) Foreign investment in Johannesburg’s luxury market will grow, especially in Hyde Park
Foreign investment in Johannesburg's luxury market, especially in areas like Hyde Park, is on the rise.
One reason is the property price-to-rent ratio in Johannesburg, which is about 10.4. This is one of the lowest globally, meaning property prices are quite affordable compared to other big cities. For investors, this affordability hints at good long-term returns, making Johannesburg's luxury market a tempting choice.
Another factor is the weakness of the Rand against other currencies. This makes South African prime properties more affordable for foreign buyers. With this currency advantage, investors can snag luxury properties at a lower cost, boosting the allure of Johannesburg's high-end real estate.
Johannesburg is also gaining recognition as a tech hub in Africa. This, along with ongoing infrastructure development, is likely to drive demand for modern office spaces and residential properties in prime suburbs like Hyde Park. The city's cultural vibrancy and urban amenities add to its appeal for luxury property investors.
Hyde Park, in particular, is known for its exclusive residential offerings and proximity to key business districts. This makes it a hotspot for those seeking both luxury and convenience. The area's blend of upscale living and strategic location is a magnet for foreign investors.
Sources: PayProp, Strategy&, Luxonomy, RE/MAX Advantage
We created this infographic to give you a simple idea of how much it costs to buy property in different parts of South Africa. As you can see, it breaks down price ranges and property types for popular cities in the country. We hope this makes it easier to explore your options and understand the market.
3) Interest in eco-friendly developments in Johannesburg's northern suburbs will grow among foreign buyers
Foreign buyers are showing increased interest in eco-friendly developments in Johannesburg's northern suburbs.
In recent years, there's been a noticeable shift towards sustainable living, with 78% of consumers valuing environmental sustainability. This trend is not just global; it's very much alive in Johannesburg, where the demand for eco-friendly properties is on the rise.
Johannesburg's northern suburbs are becoming a hotspot for green buildings. The Green Building Council South Africa has certified over 800 green buildings, many of which are in Gauteng. This makes the area particularly appealing to foreign buyers who are keen on sustainability.
Government incentives are also making a big difference. With policies like tax breaks and subsidies, eco-friendly home upgrades are more affordable than ever. This financial support is encouraging both developers and buyers to invest in green properties.
These incentives are lowering the barriers to entry, making it easier for people to choose sustainable options. As a result, interest in eco-friendly developments is growing, especially among foreign buyers who prioritize environmental responsibility.
In Johannesburg's northern suburbs, the combination of green certifications and government support is creating a thriving market for sustainable homes. This area is becoming a prime location for those looking to invest in eco-friendly real estate.
Sources: 2024's Green Revolution In Real Estate: Embracing Eco-Friendly Homes, [PDF] green building in south africa
4) Property values in Soweto will rise significantly as better infrastructure draws in more middle-class buyers
Soweto is on the rise thanks to major infrastructure upgrades.
The National Treasury's Smart Mobility Preventive Maintenance Programme is making a big difference by fixing roads and filling potholes. This means smoother drives and easier access, which is catching the eye of potential homebuyers.
Then there's the Gauteng provincial government's R27 billion housing mega-project in Johannesburg. It's not just about new homes; it's about creating a community with sustainable features like agriculture and solar farms. This is a big draw for those who care about the environment.
Public transport is also getting a boost with the Rea Vaya BRT system. It's now easier to get from Soweto to other parts of Johannesburg, making it a convenient spot for middle-class buyers who need efficient transport.
These changes are making Soweto more appealing to the middle class, who are looking for both convenience and a good investment. With better roads and transport, plus eco-friendly housing options, the area is becoming a hot spot.
Sources: National Treasury, L2B Construction News, Osmond Lange Architects & Planners
5) Yields in Johannesburg CBD will drop as investors shift focus to suburban areas
In Johannesburg, the real estate market is shifting noticeably.
The central business district (CBD) is seeing rising vacancy rates, with 2024 figures showing a 13.1% vacancy rate for decentralised grade A space. This is higher than the national average and much above pre-Covid levels, meaning fewer businesses are setting up in the CBD, leaving more empty spaces and reducing rental income for property owners.
Rental prices in the Johannesburg CBD are also lagging, with a mere 0.8% increase in 2024. This is below the national average and pre-pandemic levels, making the CBD less appealing to investors seeking better returns.
Meanwhile, suburban areas like Rosebank and Sandton are thriving. These neighborhoods are seeing a surge in investment and development due to improved infrastructure and amenities, attracting both local and international investors. The demand for residential properties in these suburbs is higher, driven by their proximity to business hubs and enhanced transportation links.
Consumer preference surveys reflect this trend, showing growing confidence in the suburban property market. This increased interest is a clear indicator of the shift in focus from the CBD to suburban areas.
Sources: Property Wheel, Business Tech
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6) Rental demand in the southern suburbs will drop as more people choose to buy homes
The rental market in Johannesburg's southern suburbs is seeing a shift as more people choose to buy homes.
One big reason for this change is the government's First Home Finance initiative, which helps moderate-income families buy their first homes. This program offers financial support, making it easier for people to move from renting to owning. With this assistance, homeownership has become more accessible for many.
Another factor is the low-interest rates in South Africa, which make borrowing money cheaper. The Reserve Bank's decision to keep rates low means more people can get mortgages. This financial climate has made buying a home a more attractive option than renting.
New residential developments in the southern suburbs are also drawing in potential buyers. These areas offer modern amenities and competitive pricing, making them appealing to those looking to purchase. As a result, the demand for rental properties is decreasing.
With these new developments, people are finding it more appealing to invest in property. The combination of government support, low-interest rates, and attractive new housing options is driving this trend. Homeownership is becoming the preferred choice for many in the area.
Sources: BusinessTech, NHFC, Johannesburg Market Data
7) Demand for affordable housing in Johannesburg will rise as the middle class grows
Johannesburg's middle class is booming, thanks to a surge in population and urbanization.
In just the past year, the city's population grew by 126,330 people, a clear sign that more folks are climbing into the middle class, eager for better homes and lifestyles. With over 68.82% of South Africans now living in urban areas, Johannesburg stands out as a bustling hub with a population density of about 2,900 people per square kilometer. This means there's a real crunch for affordable housing as more middle-class families settle in.
The Gauteng Socio-Economic Review and Outlook 2024 points out that despite some infrastructure upgrades, housing challenges persist. The Centre for Affordable Housing Finance in Africa’s Housing Market Report for 2024 backs this up, showing a strong desire for home ownership among the middle class. In 2023, 59% of first-time buyers went for homes priced up to R900,000, highlighting the need for budget-friendly options.
Sources: Johannesburg Population Estimates, Urbanization in South Africa, Property Trends in 2025
8) Interest in large family homes will drop as people prefer smaller, easier-to-manage properties
In Johannesburg, large family homes are losing their appeal as more people opt for smaller, more manageable properties.
One big reason for this shift is the rising property prices, making large homes less affordable. With the average property price expected to hit around ZAR 1.5 million by 2025, many potential buyers find it tough to stretch their budgets for bigger homes.
Maintenance costs are another factor. As property prices climb, so do the costs of upkeep, which can be a real financial strain. This makes smaller homes more attractive to those who want a cost-effective and manageable living situation.
There's also a demographic change happening. The median age of renters is now 42, and many are embracing a lifestyle that favors smaller spaces. This trend shows a growing preference for properties that fit smaller households.
Urban living is becoming more popular too. Young professionals and families are looking for affordable housing in Johannesburg's suburbs, which often means smaller, more urban spaces. This is driving up demand for convenient and accessible smaller properties.
Sources: Zillow, Johannesburg Price Forecasts, BusinessTech
We did some research and made this infographic to help you quickly compare rental yields of the major cities in South Africa versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you’re planning to invest there.
9) Interest in suburban areas like Fourways will grow as new transport links cut commute times
Suburban areas like Fourways are becoming a hot spot for property buyers, thanks to improved transportation links.
In 2023 and 2024, the Gauteng Department of Roads and Transport made strides in reducing commute times with projects like the K73 development between Woodmead Drive and Allandale Road. This has made it easier to reach key areas, including Lanseria Airport, and has alleviated congestion significantly.
These changes have sparked a noticeable shift in property trends in Fourways. More homes are being listed and sold quickly, especially those with good transport links. Real estate agents are seeing a surge in demand for properties that offer easy access to public transport and major highways.
The average listing price for properties in Fourways is climbing, particularly for larger homes. This reflects the growing interest in the area, driven by the convenience of reduced commute times and better connectivity. Urban planning documents even highlight Fourways as a growth area, emphasizing its strategic location.
With these transportation improvements, Fourways is not just a place to live but a smart investment. The area’s accessibility and reduced travel times are making it increasingly attractive to buyers looking for convenience and value.
Sources: Gauteng Roads and Transport Annual Report, Private Property, Property24
10) Property values will rise in areas with new Gautrain stations due to network expansion
The expansion of the Gautrain network is set to boost property values in areas with new stations.
Take Sandton, for instance. When the station opened, property prices shot up by 87% in just a year. This wasn't a one-off; areas like Rosebank and Midrand saw similar trends. So, if you're eyeing property near a future station, you might be onto something big.
But it's not just about property prices. The expansion is expected to create over 125,000 jobs, which means more people will be looking for homes close to these new stations. And let's face it, who doesn't want easy access to public transport these days?
The Gauteng Provincial Government is pouring money into this project, and experts say this kind of investment usually leads to higher property values. It's not just a theory; it's a pattern seen in urban planning and economic studies.
Plus, there's a growing trend among buyers who prefer properties with convenient public transport options. This isn't just a local thing; it's happening in real estate markets worldwide. So, properties near new Gautrain stations are likely to be in high demand.
In short, if you're considering buying property, areas with new Gautrain stations could be a smart move. The combination of job creation, government investment, and buyer preferences all point to a promising future for these locations.
Sources: Semanticscholar, MyBroadband, Railway Technology
11) Smart home technology will be a standard in new Johannesburg developments
By 2025, smart home technology will be a standard feature in new developments in Johannesburg.
In recent years, the smart home market has been booming across Africa, with projections showing it could hit USD 8.63 billion by 2030. This growth is not just a number; it's a reflection of how people are embracing technology to make life easier and more secure. In South Africa, the market is expected to grow significantly, reaching USD 1.285 billion by 2029.
Homebuyers are driving this change. By 2023, 70% of home buyers were actively seeking smart homes for their convenience and security features. It's not just a local trend; globally, a large number of buyers are willing to pay more for homes with smart features, showing a clear preference for tech-savvy living.
Johannesburg is becoming a hub for smart home solutions, thanks to major tech players like Samsung, LG, and Google. These companies are teaming up with real estate developers to integrate smart technology into new homes. This collaboration ensures that smart home features are seamlessly incorporated, meeting the expectations of modern buyers.
The South African government is also playing a part by promoting energy-efficient and smart technologies. By 2023, they were offering incentives and tax breaks to encourage this shift. Plus, efforts to make internet access a core utility are making smart home tech more accessible to everyone.
Sources: NextMSC, Exploding Topics, Statista
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12) Suburban living in Johannesburg will become more appealing due to better public transport
Improved public transport in Johannesburg is transforming suburban living.
In 2023, the city's Transport Management system saw a surge, with over 251,000 new users embracing public transport. This shift continued into 2024, as more operating licenses were issued, signaling a boost in public transport services. The introduction of the low-emissions bus rapid transit (BRT) system, known as the Corridors of Freedom, has been a major factor. This system not only cuts down travel times but also enhances mobility, making it easier for suburban residents to commute to the city.
The BRT system offers a fast, safe, and affordable alternative to private cars, which is crucial for promoting economic growth. As a result, suburban areas with improved transport links have seen a rise in property values. The focus on creating affordable public transport services and boosting economic growth and job density makes suburban living more appealing.
Moreover, the development of high-density housing, offices, and retail spaces along these transport corridors has enriched suburban areas with more amenities and services. This means residents can enjoy shorter, more pleasant commutes and have access to a variety of amenities, further enhancing the allure of suburban living.
With these improvements, suburban living in Johannesburg is becoming increasingly attractive, offering a blend of convenience and quality of life. The city's commitment to enhancing public transport is not just about moving people; it's about creating vibrant, connected communities.
Sources: Gauteng Roads and Transport Annual Report, C40 Cities Case Study
13) New zoning laws will create opportunities for residential development in Johannesburg
Johannesburg is shaking up its zoning laws to make room for more homes.
In the past, certain areas were off-limits for residential development, but now, new zoning changes are opening up these areas for mixed-use projects. For instance, the rezoning of Erf 576 Park Wood from "Residential 1" to "Business 4" is a clear sign of this shift. This aligns with the City's Nodal Review Policy 2020, which encourages a blend of residential, office, and retail spaces in key areas.
There's been a noticeable uptick in rezoning applications, with more approvals coming through for areas that were previously restricted. This change is backed by the Development Management Department and the Municipal Planning Tribunal, showing a move towards more flexible land use. The city is focusing on developing metropolitan nodes, which are perfect spots for new homes.
The demand for housing in Johannesburg is pushing these changes. The city is adjusting its zoning rules to make way for new housing units, much like New York City's recent zoning reform aimed at creating over 82,000 new homes. This growing need for housing is likely to lead to more residential developments as zoning laws continue to evolve.
Urban planning reports, like the Nodal Review Policy 2020, are key in spotting new residential zones and promoting mixed-use developments. These reports guide rezoning applications, ensuring they fit with the city's planning goals. Johannesburg's proactive stance on revising zoning regulations suggests a bright future for residential growth in newly zoned areas.
With these changes, Johannesburg is set to become a more vibrant city, offering a mix of living, working, and leisure spaces. The city's efforts to revise zoning laws are paving the way for new residential opportunities in areas that were once off-limits.
Sources: SAFLII, NYC Council, SAPRA
While this article provides thoughtful analysis and insights based on credible and carefully selected sources, it is not, and should never be considered, financial advice. We put significant effort into researching, aggregating, and analyzing data to present you with an informed perspective. However, every analysis reflects subjective choices, such as the selection of sources and methodologies, and no single piece can encompass the full complexity of the market. Always conduct your own research, seek professional advice, and make decisions based on your own judgment. Any financial risks or losses remain your responsibility.