Five Defining Property Trends for 2026

Supported by positive macroeconomic factors – including a series of interest rate cuts, subdued inflation, and South Africa’s exit from the Financial Action Task Force’s grey list – 2025 shaped up to be a noticeably stronger year for the residential property market, laying the groundwork for Defining Property Trends for 2026.

“With six interest rate cuts now under our belt, the industry has benefited from renewed confidence, however with only a fairly modest increase in activity levels,” explains Rhys Dyer, CEO of the ooba Group.

ooba Home Loans recorded a steady year-on-year growth in application volumes during 2025 – up 9% with a 17% surge in value. In Quarter 4 ’25, applications by first-time homebuyers averaged 46.3%, up from 43.3% of applications mid-2024.

“Regionally, the Western Cape continues to lead the market’s recovery; however, historically slower-performing regions such as Gauteng and KwaZulu-Natal have since shown clear signs of rising house price growth and increased homebuyer demand,” notes Dyer.

Data from Lightstone reflects this shift. During the year to Nov’25, national house price inflation (HPI) averaged +3.2%, with regional growth ranging from +7.4% in the Western Cape to +2.5% in KwaZulu-Natal and +1.9% in Gauteng.

“Together, these indicators point to a market steadily regaining momentum, with improving buyer confidence and more broad-based regional activity shaping a cautiously optimistic outlook for 2026,” says Dyer.

Top Defning Property Trends for 2026

Looking ahead, Dyer highlights five key trends set to shape South Africa’s property market in 2026 as follows:

1. Emerging Regions Step into the Spotlight

In 2026, activity in more affordable metros will increase, following a long period of slow or negative price growth. This will accelerate activity in regions such as Gauteng and KwaZulu-Natal. “Data shows that demand from high-net-worth buyers to secure estates and established suburbs in Johannesburg is growing. At the same time, coastal developments in Durban are attracting both local and international investors,” shares Dyer.

KwaZulu-Natal is also showing notable demographic shifts. Female first-time homebuyers accounted for 57.7% of total mortgage applications in 2025. This is up from 47.7% over the past decade, as reported by the StatsSA Residential Property Index. “These trends confirm that South Africa’s housing market recovery is broadening. Momentum is now visible across multiple provinces rather than being concentrated in the Western Cape,” explains Dyer.

Growth nodes and lifestyle markets gain momentum

The rise of new growth nodes is reinforcing this geographic spread. Dyer highlights areas such as Sandton and Waterfall. These remain popular with younger professionals in Johannesburg. Cape Town’s northern suburbs also continue to attract buyers. Affordability and reliable transport links remain key drivers.

“Coastal lifestyle markets remain in high demand. Durban’s coastal belt and Garden Route towns are still favoured for semigration,” continues Dyer. “Hoedspruit in Limpopo is also emerging as a lifestyle destination for Johannesburg semigrants. Meanwhile, Lightstone sales figures show that secondary cities such as Gqeberha and Bloemfontein are seeing increased demand. This is driven by affordability and the support of government-backed housing developments.”

First-time homebuyers will continue to drive growth in more accessible regions. This includes the Free State, where they accounted for 65% of all applications in the final quarter of 2025. Adding to the momentum, Dyer notes that the evolving political landscape could also shape activity. The upcoming 2026 local elections are expected to spur improvements in municipal service delivery. This could unlock renewed confidence in previously underperforming regions.

2. More Stability in a Lower Interest Rate Environment

Dyer believes the fiscal metrics that supported multiple rate cuts in 2025 will pave the way for further easing and accelerated homebuying activity in 2026. “Both the South African Reserve Bank and National Treasury formally adopted a lower 3% inflation target, signalling a credible commitment to aligning inflation with emerging-market peers,” explains Dyer.

Lower debt-servicing costs, lower petrol prices, the stronger Rand, easing inflation and improving household finances will continue to support spending and borrowing in 2026, notes Dyer, further underpinned by attractive lending by the country’s major banks.

“If current trends hold, we anticipate another 50 to 75 basis points of rate cuts in the current cycle, with additional relief possible once inflation expectations are fully anchored around the new target. Any further normalisation in interest rates would significantly boost national housing activity by improving affordability for a wider pool of potential homebuyers,” he says.

3. Sustainability Shapes Demand, Especially Among Gen Zs

Demand for sustainably designed homes is rising across the country, reshaping buyer expectations and developer priorities. “Sustainability is the name of the game in 2026,” says Dyer, noting the growing number of buyers seeking eco-friendly features that offer practical solutions to loadshedding, water scarcity and escalating utility costs.

“Features such as solar power systems, rainwater harvesting, greywater recycling and energy-efficient appliances are no longer niche,” says Dyer. “Today, they’re essential selling points to attract more homebuyers and yield a higher resale value – particularly among younger families and homebuyers [Gen Zs] – who prioritise green housing as a lifestyle and investment choice.”

The data confirms that younger buyers are becoming a powerful market force. Lightstone data shows that, in 2025, most buyers were aged 30-45, spending on average just under R1.4m on a property, with buyers aged 18-30 spending just under R1.2m. ooba Home Loans data for Q4 ’25 shows the average age of first-time buyers is 36

“Developers are responding to growing market demands by integrating green standards into new projects and increasingly aligning with Excellence in Design for Greater Efficiencies [EDGE] certification – this requires buildings to be designed and constructed using at least 20% less energy, water and embodied energy in materials,” says Dyer.

4. New Developments Surge – Again

Certain nodes such as Rosebank, Morningside and Bryanston in Johannesburg experienced high supply and low demand in recent years, however, even before all of last year’s sales have been processed by the Deeds Office, these suburbs had already registered more sales in 2025 than the whole of 2024. According to Stats SA, the number of building plans passed has rebounded from a Feb’25 low, which Dyer says indicates that the market is now in positive territory, and it’s likely that more developers will be drawn back into action, focusing on secure estates, eco-friendly features and mixed-use hubs.

“Homebuyers are returning cautiously, attracted by lower interest rates and no transfer duty below R1.21 million, with most preferring smaller, urban sectional title homes,” says Dyer, with Lightstone sales activity data showing that urban rental demand is rising in cities like Sandton, Claremont, Durban North and Pretoria East, driven by fibre connectivity, co-working spaces, nearby amenities and reduced commuting needs.

“Short-term rentals are also thriving near universities, hospitals and tourist hubs, with many new developments allowing pets and Airbnb-style lets,” he says. “Investors are capitalising on tourism recovery and student housing shortages.”

Dyer adds that financing remains selective, with affordability challenges being offset by joint applications and pre-approval advantages. In addition, rent-to-own schemes are growing, helping tenants transition to ownership, while smart features like solar, fibre and water-saving systems are now standard.

“Government-supported and commercial-to-residential conversions – including Central Park in Kempton Park and Cape Town’s Founders Garden, Leeuloop and Prestwich Precincts – continue to expand affordable and mixed-use housing,” says Dyer.

5. What the Return to the Office Means for the Market