South Africa’s property market likely to turn the corner in 2026 — but not everywhere

South Africa’s residential property market may be heading into calmer, more favourable waters in 2026, with lower interest rates, improving affordability and a better balance between buyers and sellers.

That’s the view of Herschel Jawitz, CEO of Jawitz Properties, as households weigh up whether this is the year to buy, sell or keep renting.

Buyers could finally get some breathing room

Jawitz says buyers are likely to face a more supportive environment than they did a year ago. Interest rates have already come down steadily, with the prime lending rate sitting at about 10.25%.

With inflation targets lowered and price pressures easing, he expects another one or two rate cuts in 2026, potentially taking the prime rate closer to 10% or even 9.75%.

By South African standards, those levels significantly improve affordability for home loans.

Combined with relatively subdued property prices in several regions, including parts of the Western Cape, the year ahead could offer better value and stronger buyer confidence.

Sellers benefit from tighter stock

Sellers may also find conditions improving, largely because there has been no flood of properties coming onto the market.

Over the past few years, many homeowners held back, unwilling or unable to sell at prices they felt were too low. As a result, stock levels have remained tight across much of the country, even in provinces that traditionally see higher supply.

That balance between demand and available homes is now far healthier, supporting price growth. According to recent FNB data cited by Jawitz, national house price growth is approaching 5%, the strongest average in several years.

Rental market remains uneven

The rental picture is more mixed.

Nationally, Jawitz describes the market as relatively well balanced, with reasonable rental escalations and continued affordability in many areas.

However, the Western Cape remains a clear outlier. In popular and well-located areas, rental stock is scarce, and demand is intense, pushing prices higher and making it tough for tenants.

Location matters more than ever

Jawitz cautions that headline figures can be misleading. While online listings may suggest an abundance of properties, many are in areas with limited demand.

In contrast, prime locations such as the Atlantic Seaboard continue to experience shortages, even as new apartment developments try to ease pressure.

For many households, the affordability gap means renting or buying further from work hubs, relying on commuting or remote work. In cities like Cape Town, this has real knock-on effects for traffic patterns and daily living costs.

A cautiously optimistic outlook

Overall, Jawitz believes 2026 is shaping up to be a more constructive year for the property market, not a boom, but a period of gradual recovery.

For buyers and sellers, improved affordability and tighter supply are encouraging signs. For renters, especially in high-demand metros, the pressure is unlikely to ease quickly and location will remain the deciding factor.

For more information, listen to Jawitz using the audio player below: