Grant Smee
Only Realty Property Group
CEO
The Western Cape continues to be one of South Africa’s most sought-after regions for property investment, drawing substantial interest from both local and international homebuyers.
However, for first-time homebuyers, particularly those considering Cape Town, homeownership poses a challenge as the province records the highest average purchase price. Nevertheless, data indicates that activity in the entry-level market continues, suggesting that many homebuyers are discovering innovative ways to gain a foothold on the property ladder.
According to the latest oobarometer data from ooba Home Loans, the average purchase price in the Western Cape for Q1 2025 was R2.33 million – significantly higher than the national average of R1.66 million. Nevertheless, the province continues to attract first-time homebuyers, as the demand for property in the region shows no signs of abating.
“We’re seeing many young professionals and investors gravitating towards the Western Cape for its lifestyle, infrastructure and perceived safety, but affordability in the metro remains a challenge, especially for those trying to enter the market for the first time,” explains Grant Smee, CEO of Only Realty Property Group.
Who Is Buying in the Western Cape, and Where?
Lightstone data indicates that 40% of the Western Cape’s housing stock is priced under R750,000. While this price point appears more accessible, most of these properties are located in smaller towns and rural areas.
Investment properties are also in high demand, with the Western Cape recording a year-on-year increase of 0.5% to reach 12.9% in the first quarter [ooba Home Loans]. There is a growing trend of first-time homebuyers purchasing in the Boland and Overberg regions in smaller, outlying towns,” says Smee. “These areas offer a more balanced lifestyle and slightly more accessible pricing, while still benefiting from the broader Western Cape infrastructure.
He states that entry-level homebuyers investing in Cape Town’s CBD are increasingly opting for more affordable micro-apartments and sectional title units within high-density, mixed-use developments: “These offer security and lifestyle perks like on-site retail, communal workspaces and gyms.”
Attracting Foreign Investors
Meanwhile, the Western Cape remains a prime choice for foreign homebuyers, boasting its global allure and sought-after lifestyle at comparatively more affordable prices than other regions. However, Smee notes that they are investing in a higher price bracket.
“According to Lightstone data, the province leads in luxury price bands, with international homebuyers accounting for over 40% of purchases above R10 million, around 25% in the R5 to R10 million range, and approximately 15% in the R3 to R5 million bracket.”
He adds: “Compared to global cities, the Western Cape offers strong value. For instance, the average price of a home in one of the region’s upmarket suburbs sells for around R10 million. To purchase an apartment in London – with considerably less living space – homebuyers will pay upwards of R12 million.”
The Australian Property Investor also highlighted South Africa’s comparatively low housing prices, with South Africans paying around R17,000 per square metre for a median-priced home, compared to Australia’s R113,000 for the equivalent.
Alternatives for First-Time Buyers
Smee notes that while the Western Cape continues to excel in the property market, discerning buyers are increasingly considering outlying regions that offer greater value for money than central Cape Town. Areas such as the West Coast, the Garden Route, and the northern and southern suburbs provide appealing alternatives.
“The Western Cape’s so-called ‘Zoom’ towns – so-called for their remote working appeal—include Pringle Bay, Betty’s Bay, Kleinmond, Malmesbury, Hermanus, and Gansbaai,” he explains. “These areas provide easier entry points for buyers and remain within comfortable reach of Cape Town.”
However, he adds that excellent opportunities also exist beyond the Western Cape. “Mpumalanga, for instance, is currently leading the pack when it comes to home loan applications from first-time buyers [ooba Home Loans]. Nelspruit, in particular, is booming with new estate developments that offer a secure, lock-up-and-go lifestyle, community atmosphere, and budget-friendly pricing.”
Gauteng also continues to hold a strong appeal. “Popular nodes like Waterfall, Bryanston, and Hyde Park are drawing interest from buyers seeking well-established infrastructure and upscale living,” he says.
Meanwhile, KwaZulu-Natal’s North Coast – particularly Umhlanga, Ballito, and Salt Rock – has become a magnet for investment. “Over the past decade, this region has experienced massive growth, with estate developments, excellent schools, security, and community-driven living making it an increasingly worthwhile investment,” he adds.
The Eastern Cape is also quietly gaining momentum. Towns such as Kenton-on-Sea and Jeffreys Bay are becoming hotspots for short-term rental investors, thanks to their appealing lifestyle offerings and increasing popularity.
“These regions combine access to economic centres with strong lifestyle appeal, without the Cape Town price tag,” Smee explains. “For buyers willing to expand their horizons beyond the Western Cape, there are standout opportunities, many in secure estates or fast-growing nodes. And with many of these areas doubling as holiday destinations, they open the door to ‘rentvestment’ opportunities, whether for short-term letting or longer-term leasing.”
Practical Tips for Accessing the Market
“For homebuyers determined to secure a foothold in the Western Cape property market, there are numerous options available,” he notes. “This investment is well worth it too as the average growth of property in the province is around 7.4%.”
He shares his top tips for those wanting to get a foot on the property ladder as follows:
Enter into a joint home loan: Co-buying with a friend, partner or sibling can boost affordability and borrowing power.
Save intelligently and plan for the long term: Establish clear savings goals and budget realistically for transfer and attorney fees.
Begin on the periphery: Neighbourhoods located just outside major metro areas frequently provide more affordable prices and are positioned for expansion.
Consider purchasing a fixer-upper: Properties requiring some work can often be negotiated at lower prices and renovated over time.
Buy-to-let as a stepping stone: Acquire an investment property in a growing area while renting where you reside.
“The Western Cape is a great place to invest, but it may require a bit more creativity and long-term thinking for first-time homebuyers to make it work. Alternatively, if the Western Cape doesn’t meet your criteria, regions like the Eastern Cape, KwaZulu-Natal, and Mpumalanga have potential. It’s not about compromising your goals, but rather being strategic,” says Smee.