Predictions for Property Market Performance
As we approach 2025, the South African property market stands at a crossroads, influenced by a mix of global economic trends, local policy decisions, and shifting consumer behaviour. From interest rate fluctuations to the growing uncertainty around global economic policies, the year ahead promises both challenges and opportunities for property buyers, sellers, and investors.
Expert Predictions
Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa, predicts that “there will be slow and steady reductions in the repo rate throughout 2025 – probably roughly 1.25% down between now and Dec ’25. This will lead to an increased buyer pool from both first-time buyers as well as investors. It should also create some breathing room for existing homeowners with home loans.”
Regional Opportunities
Goslett adds that the Western Cape will continue to provide safe and steady returns – albeit at a premium entry price. “There is value to be had in Gauteng and KZN over the next 6 months. Once interest rates come down and buyer demand goes up, the opportunity for value home purchases may continue to exist for a while, but the availability of value-priced homes will become significantly reduced as sellers expect higher offers as the demand increases,” he states.
Foreign Investment in South Africa
With respect to foreign buyers purchasing in SA, Goslett believes that South Africa remains grossly undervalued and is a ‘steal’ for foreigners. “We have our challenges in this country for sure, but ultimately, SA is and will remain a great investment option for foreigners looking to have their cake and eat it – to live in Europe and the US earning euros and dollars and escape seasonally to enjoy that hard-earned money in a country that offers luxury at bargain prices,” he notes.
The Role of AI in Real Estate
Another aspect that might affect the real estate industry in the year ahead is how AI will impact the way of working. “The catchphrase in all industries right now is AI and everyone is trying to figure out how this may affect their respective businesses. In real estate, you will find an increase in products and services entering the market using this technology – with all these companies scrambling to be the front runner in lead generation and lead management,” he explains.
“Inside that space, AI will have a role to play, but the core role of the agent will not be replaced by tech. Rather, nurtured client relationships and real-time local market knowledge is what clients need from their agent, and this cannot easily be replaced by technology,” he states.
Future of Real Estate Agencies
Sharing his final thoughts on what lies ahead, Goslett notes that “with the likelihood of improved market conditions, those who work within the real estate industry will only be willing to stay with a real estate brand that offers value. Whether that’s a franchise, a brand or an independent agency – the value it offers in the form of training, market share, access to stock, brand power, and back-office support will determine whether an agent is willing to pay for those services through their commission splits or fixed fees. If an office doesn’t add value, the agents will, in all likelihood, find alternative offerings that do,” he concludes.
