Western Cape tops the charts for semigrants | Everything Property
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Western Cape tops the charts for semigrants

net foreign


According to recent reports, semigration is the prevailing trend affecting real estate investment in South Africa.

According to a recent Economics Weekly report, informed by the FNB Estate Agents Survey, property sales due to emigration have slowed down significantly. In 2019, they made up about 18% of all domestic property sales, but by the second quarter of 2023, they averaged only 9%. Instead, the semigration trend is prevalent, which means more people are moving within South Africa, most likely influenced by factors like the pandemic, which created travel restrictions and increased remote work opportunities.

Foreign investment in South African homes has been as low as 3% of all property sales in the second quarter of 2023, below the peak of about 6% in the third quarter of 2016 and the long-term average of 4.2% since the second quarter of 2004.

“Notwithstanding nuances at an area level, this would suggest that foreigners have broadly not capitalised on advantageous conditions, including a depreciated currency, likely reflecting unfavourable sentiment towards the country,” says Siphamandla Mkhwanazi, FNB Senior Economist. “Our survey [also] enquires about the volume of [South African] expats procuring homes locally for investment purposes or upon their return to the country. Having recently peaked at approximately 3% at the end of 2020, expatriate acquisitions have moderated to 2% by the second quarter of 2023.

While the significance of expat activity has somewhat recovered from the 2018 lows, when such transactions accounted for just 0.5% of the market, it has remained stable around the long-term average of 2.1%.”


A negative value for net foreign demand, defined as the difference between inbound demand (participation of foreign nationals and expatriates in the domestic market) and outbound supply (emigration-linked sales), means that migration leads to an oversupply of homes available for sale, which puts downward pressure on prices.

South Africa experienced a period of buoyant net foreign demand between 2011 and 2014, peaking at about 6% in the fourth quarter of 2014. This coincided with solid house price growth, averaging 7.8% in 2014, the highest rate since the global financial crisis. However, since then, the impact of net foreign demand on the property market has declined, reaching negative territory by the second quarter of 2017.

The most significant negative impact was seen around the fourth quarter of 2019, at around – 13%, just before the COVID-19 pandemic. Since then, the negative influence of net foreign demand has decreased, reaching – 2% in the second quarter of 2021 due to slightly increased expatriate activity and slower emigration sales.

FNB’s estimates for the second quarter of 2023 show that net foreign demand was around – 4% of domestic property sales. This indicates a demand shortfall caused by migration, which requires local buyers to fill the gap to maintain a balance between supply and demand. The negative net foreign demand is one of the factors explaining the restrained growth in house prices in South Africa, along with weak economic conditions and tighter financial circumstances.

net foreign


“The Western Cape is still the top choice for semigrants,” says David Jacobs, Regional Sales Manager for the Rawson Property Group. “Its biggest attractions are better service delivery, better-maintained infrastructure, and unemployment rates more than 10% lower than the national average.”

Nevertheless, the province experiences higher rental and housing price inflation rates than the national average, especially within its primary metropolitan area, Cape Town. Jacobs points out that this can be costly for individuals who are semigrating from other provinces as they seek to purchase or rent a property in the Western Cape that matches their previous residences. Nevertheless, those open to residing just slightly outside the urban centres may discover that prices align more with what they were accustomed to in their hometowns.

“Larger coastal towns like Mossel Bay are proving very popular with semigrants,” says Jacobs. “Property prices there are still relatively affordable, but rising demand paired with ongoing growth and urbanisation will see these increase over time.”


In addition to the Western Cape’s coastline, several slightly smaller towns are witnessing a significant influx of semigrants, including places like Hermanus and beloved West Coast destinations such as Langebaan, Paternoster, and St Helena Bay.

However, it’s not only the Western Cape that has piqued the interest of semigrants. Jacobs notes that both the Eastern Cape and KwaZulu-Natal (KZN) are becoming strong contenders, giving the country’s “golden child” a run for its semigrant population. “The Eastern Cape offers many of the same outdoorsy lifestyle features as the Western Cape, but has a more temperate climate and a more affordable price point, on average,” says Jacobs. “There is arguably less opportunity in employment, but with remote work as prevalent as it is, that isn’t a dealbreaker for everyone.”

Much like the trend observed in the Western Cape, smaller towns in the Eastern Cape are experiencing significant popularity among semigrants. Port Alfred stands out as a solid favourite among mid-sized options, as does its smaller coastal neighbour, Kleinemonde, along with the inland agricultural town of Bathurst. “KZN’s semigration trends are slightly different,” says Jacobs. “The North Coast, around Ballito, is popular with affluent semigrants from Gauteng, while the Mid-South Coast, around Port Shepstone, is gaining traction in the more cost-conscious market. Regarding lifestyle and opportunities, estate living is very popular in these areas, offering residents private security and good service delivery.”

net foreign


With so many options, it can be challenging for semigrants to pick their preferred destination. Jacobs says much depends on budget, lifestyle preferences and conditions of employment. No matter the destination, planning for the move well in advance is a good idea – particularly if you plan on selling an existing property.

“We’re seeing a lot of property sales to semigrating buyers put on pause – or even fall through – because of delays in selling their previous homes,” he says. “Properties in semigration hotspots are moving much faster than in other areas. It’s far wiser to sell first and shop around afterwards with the ability to put a condition-free offer down as soon as you find the right home.”

To make the process easier, Jacobs highly recommends working with a real estate brand with a national footprint, or atleast a local presence in both your hometown and chosen destination.

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