Property market set for a new look, says Tyson Properties
Property market set for a fresh perspective in South Africa as confidence in the sector continues to grow. Right now, confidence in South Africa’s property market is high. On the back of an investment friendly budget and the State of the National Address (SONA), and amid massive global geopolitical turbulence, there is a strong case for investing in an enclave in Africa.
The quiet optimism emerging across the sector is seeing most locations show signs of recovery, says Francois du Toit, managing partner of Tyson Properties Johannesburg.
He has identified five emerging trends that reflect this more positive outlook. While it may not result in an outright boom during 2026, he believes these trends clearly show why potential buyers should take a fresh look at property investment.
For readers exploring the evolving South African property landscape, it is also useful to understand other perspectives on property investment and ownership, such as whether to choose a freehold home or sectional title living. This is discussed in House or sectional title?.
Property market set trends shaping South Africa’s housing sector
Homeowners are getting younger
Absa’s latest Homeowners Sentiment Index (HSI) for the fourth quarter of 2025 shows clear growth in confidence. It also reveals that younger respondents (under 44) are far more confident than older respondents (over 55). Data from the South African Deeds Office supports this trend. Buyers under 44 are active in the market and account for half of all property purchases.
“This also highlights another important trend – the growth of purchases in gated estates. Younger buyers are driving property investment that combines lifestyle choices and security, with the added benefit of stronger returns in the medium to long term. In short, younger buyers want more value for their money. Through shared economies of scale, they can access amenities they would not normally afford on their own,” he says.
The return of first-time homeowners
Closely aligned with this is the growth in first-time buyers – a trend that Du Toit and other real estate professionals believe will be the most significant in 2026. He notes that while the rental market in major hubs such as Gauteng and the Western Cape remains strong, newcomers increasingly see the value in paying off their own bond rather than an investor’s. Du Toit believes affordability and accessibility are key factors encouraging younger buyers to make their first purchase.
Property market set for financing and economic shifts
An open-door policy from lenders
Gone are the days where funders dictated the terms. Right now, banks are actively courting and competing to secure sound borrowers as the property market stands on more solid ground. Lower interest rates are helping make financial institutions more investor friendly. Du Toit also believes a more modern approach to financing is taking shape. Looking ahead, this is likely to give buyers more bargaining power.
Reserve Bank governor Lesetja Kganyago’s announcement in Davos that it was looking into scrapping or restructuring the prime lending rate to modernise the financial system suggests a major realignment. The prime rate – currently 10.25% after an interest rate cut in November last year – has been the benchmark for rates banks offer clients since 2001. It reflects the addition of a standard 3.5% to the base rate offered by the central bank. When applying for a home loan, clients are offered a rate centred on the prime rate. It is then adjusted depending on the cost of funding, risk appetite and creditworthiness.
“Doing away with the prime rate will increase competition for loans between lenders and see banks offering more market related options to potential clients. It will also inject greater transparency into the lending process. With banks already under the watchful eye of the Competition Commission for alleged potential price fixing, the role of credit risk and the cost of lending will play a greater role in negotiations with lenders going forward. This will pave the way for better deals for borrowers,” he says.
Interest rates and inflation
The situation unfolding in the Middle East could significantly push up global fuel prices. Combined with government’s fuel levy increases that are about to come into effect, inflation could breach the Reserve Bank’s new 3% target. The challenge is that staying within this band is key to continued interest rate cuts, which are expected to support further growth in the property market.
However, both the 2026 budget and President Cyril Ramphosa’s announcement during SONA suggest there is room for improvement in the near future. A white paper will look at the structure of local authorities and potential reforms.
For those interested in how regulations and legal frameworks affect property transactions, it may also be helpful to read about The Property Practitioners Act and disclosure of defects which outlines responsibilities within the property industry.
