HEIBERG ESTATES NEWSLETTER: AUGUST 2026

Dear Property Partners

Our South African Property Market continues to demonstrate remarkable resilience and vitality! Improved economic fundamentals and fiscal discipline, repeated sovereign rating upgrades, as well as our rand exchange rate holding its own and even dipping below R16 per US dollar last week, fundamental business confidence is increasing, whilst all of the mentioned are impacting well on our property market.  Stable interest rates, supported by steadily rising household incomes, are contributing to stronger buyer interest and confidence to invest in our property market. There is healthy home loan application activity, particularly amongst first-time buyers. Despite a slower pace of loan applications with our financial institutions, which have recently increased their criteria and deposit requirements, this has been more than offset by growth in loans granted, which increased by 4.1% year-on-year in July and by an impressive 28% since July 2024!

It is a well-established and globally acknowledged fact that buying a home is one of the best ways to create financial discipline, whereby debt is converted into equity over time, building long-term wealth. Property owners regard it not only as a residence and lifestyle asset that provides stability and security, but also as a sign of financial success and a valuable back-up through consistent annual price increases towards a comfortable retirement. Our property market is highly localised, with noticeable differences in price growth, for example when comparing Johannesburg to Cape Town. StatsSA reports that between 2010 and 2020 residential prices in Cape Town increased by 141%, compared with 71% in Johannesburg – virtually double!

In line with the US Federal Reserve Bank as well as the Bank of England, our own SA Reserve Bank also did not increase its repo rate and kept its benchmark lending rate at 7% in July, with the prime lending rate remaining steady at 10.5%. This brought welcome relief for homeowners, as stability in monthly bond payments is always important for longer-term financial planning. It appeared to be the right decision, especially with our inflation rate declining in July to 4.3% from the 5% recorded in June, together with our rand performing consistently strongly against foreign currencies. Hopefully, our inflation risk profile will become less acute should oil prices ease in the near future, although much depends on the Middle East conflict and ongoing uncertainties. Despite the knock-on effects of the Middle East conflict, particularly our fuel price increasing by virtually R5 per litre since the war has started. At least our Tourism Industry fortunately benefitted, with tourism for the first six months this year increasing by 5.6% year-on-year.

A noticeably encouraging trend and a significant stimulation to increasing buyer interest in our SA Property Market, is the continued growth in homebuyer income. This is estimated to have increased by 10% to 14% for buyers over the past two years, underpinning demand and providing real momentum to our property market.

Some of the latest interesting facts and statistics:

• Our financial institutions remain supportive, with competitive loan rates and elevated approval rates, although they have lately increased their deposit requirements amid economic headwinds and uncertainties to limit their risks.
• The increase in loan applications illustrates the resilience of our SA Property Market.
• For all buyers across all sectors, the average deposit required increased to 9.5% in July, whilst first-time buyers required an average deposit equal to 13.2% of the home selling price.
• Interesting to note that with consistent salary increases, together with the SA Reserve Bank’s interest rate cutting cycle that started in late 2024 and continued into early 2026, the ratio of average deposit to average annual salary has fallen by 21% since peaking in the fourth quarter of 2022.
• First-time buyers remain at the forefront of loan applications, with the Eastern Cape recording a 21% increase over the past two years, the Western Cape 20%, and Mpumalanga 18%.
• The national average home loan value for first-time buyers was recorded at R1.2m for July 2026 year-on-year.
• First-time buyers represented 48.8% of entry-level housing bond applications, whilst Ooba Home Loans reports a national approval rate of 83.9%. Standard Bank recorded so far that successful home loan applications granted were R3 billion more than last year over the same period – an increase of 17%. Nedbank approved loan applications of R17.2 billion during the first 6 months of this year.
• House price increases is due to higher property prices and not the interest rate, since the prime lending rate is currently exactly the same as this time last year.
• The average house price in South Africa has increased and, according to eXp, reached R1 766 796, which means that monthly payments on an average home increased by 4.2% over the past 12 months.
• The national house price increase rose to 5.1% as recorded in June and averaged 4.8% over the first six months of this year – the best increase recorded since 2021.
• The Western Cape remains the strongest performer at 10.3%, followed by Gauteng at 3% and KZN at 2.8%.
• South Africa’s young middle class continues to play a major role in our residential property market, with 30% of home sales going to buyers under the age of 35.
• Pretoria and Johannesburg attract the largest proportion of younger buyers, where about 35% of these buyers are under the age of 35, and an estimated 65% of all these property transactions were below the R1.5m price range.
• Lightstone data shows that overseas buyers are increasingly entering our luxury property market segment, where SA’s comparatively affordable luxury property prices, lifestyle appeal, good weather, excellent banking system and favourable exchange rate continue to attract foreign property investors, securing quality SA property investments.
• Foreign buyers accounted for 39% of all property sales above R20m, whilst foreign transactions account for just 6% of SA’s total residential housing market.
• Also interesting to note that foreign buyers accounted for 15% of transactions between R4m and R10m, 26% between R10m and R20m, whilst 7.8% of all property sales in the Western Cape went to foreigners.

Certainty and stability in monthly payments are crucial for most property investors. With the SARB not increasing the repo rate at their last meeting, despite so many leading economists predicting an increase, it was clear that the SARB acknowledged its role to, as far as possible, support market activity rather than restrict it. In the process of keeping its rates unchanged and creating a stable rate environment, the SARB showed support for our fragile economic growth environment and preserved credibility in the transition towards its lower inflation target of around 3% – as reported before, the previous inflation band of 3% to 6% was recently reduced to 3%.

We all know that stability is so important for our SA Property Market, especially when considering interest rates, with the next SA Reserve Bank (SARB) announcement expected in September and with widespread hope that the repo rate will not be increased. Most buyers considering purchasing property with a bond will hold back when renewed threats of interest rate hikes loom in the near future. The healthy and gradual increase in house prices and sale volumes recorded over the past year is a positive sign and illustrates the resilience of our SA Property Market despite ongoing headwinds and our fragile economy.

So, let’s get moving in assisting you to secure your new property investment! Your Heiberg Estates Team remains on 24/7 standby; please call us! We are virtually sold out, so please contact us should you wish to sell, or if you could refer somebody to us wanting to sell – it will be deeply appreciated!

Yours faithfully

Bambie & Heiberg Estates Team