Cape Town – Property prices in Cape Town have risen sharply in recent years, fuelled partly by an influx of foreign homebuyers across the Cape Peninsula.
According to EWN, foreign buyers accounted for half of all home sales in Scarborough in 2024, with other popular areas including the Atlantic Seaboard.
Property economist John Loos said the surge reflects Cape Town’s strong appeal but warned that it cannot be blamed entirely on international buyers.
“Sometimes we have a frequency bias issue. We bump into one or two foreigners buying in an area by coincidence and suddenly think they’re taking over the whole suburb, but they’re not,” he said.
Loos linked the city’s booming property market to its growing economy and international appeal.
“Foreigners come here with purchasing power, and sometimes they come with skills too,” he said, adding that limiting foreign investment could “curb the economy and possibly reduce job creation.”
He emphasised the need to increase housing supply by developing new high-density residential nodes to meet growing demand.
“The population is growing at a steady pace and spreading the economy to areas which are typically dormitory towns on the Cape Flats,” Loos said.
A report by Estate Living found that since 2010, property prices around Cape Town have jumped 160%, according to Statistics SA. The Western Cape, home to just 12% of the population, accounts for 31% of the country’s total property value and 40% of all transactions above R10 million, Lightstone data shows.
Grant Smee, CEO of Only Realty Property Group, identified three key factors driving Cape Town’s property prices:
Foreign investor demand – Between 2019 and 2024, the proportion of non-resident foreign buyers increased from 2.9% to 3.7%, with average purchase prices exceeding R2.7 million — more than double that of local buyers.
“Favourable exchange rates, global economic uncertainty and relative affordability compared to other coastal markets have driven demand for luxury homes across the Atlantic Seaboard and Southern Peninsula,” said Smee.
Job creation and good governance – Cape Town’s well-managed local government continues to outperform other metros, with the Western Cape ranked highest in the latest Ratings Afrika Municipal Financial Sustainability Index.
“Stable infrastructure, service delivery, and a thriving private sector have encouraged domestic and international migration to Cape Town,” Smee noted.
Scenic lifestyle and limited land – Cape Town’s natural beauty and geography attract buyers but also restrict expansion.
“Limited space for expansion keeps supply tight and prices elevated, particularly in high-demand suburbs like Clifton, Constantia, and Bantry Bay,” said Smee.
Last month, Helen Zille sparked online debate after an interview in which she discussed why property in Cape Town is expensive. The remarks drew backlash, with critics accusing the Democratic Alliance of “selling Cape Town to foreigners.”
Helen Zille is selling Cape Town to foreigners. Even white people are not happy.
We warned you & you called us xenophobic.
Brown Mogotsi Vusi Khekhe Fikile Mbalula Xolani Bongani Sizwe Sundowns Cat Matlala pic.twitter.com/LHtg1FahiG
— Brandon (@Umalumewabantu) October 7, 2025
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Compiled by Anda Tolibadi
