The South African residential market has become a lot cheaper in recent years for foreigners whose incomes are denominated in some of the World’s major currencies.
This is due to a major depreciation in the Rand over the past few years, which has negated any house price growth which has taken place in Rand terms.
Not only is South African property a lot cheaper for foreign buyers than a few years ago, but property is more popular as an asset class globally compared to its status a few years ago.
This increase in popularity, coupled perhaps to the cheaper foreign currency denominated house prices, appears to have been driving a further uptick in the levels of foreigner buying in the local market.
From a low point of 2 % of total buying at a stage of 2010, the FNB Estate Agent Survey respondents have gradually raised their estimate of the foreigner buying to 5.5 % of total domestic home buying in 2014.
Foreign buying of SA property by African Continent buyers appears to continue to strengthen, with African Continent buyers estimated at 24.5 % of total foreign buying in 2014. This is up from 12.5 % in 2013.
It would appear that the Cape Town region has experienced the strongest recovery in foreign buying levels, with agents in the 4th quarter survey estimating foreign buying to be 13 % of total buying in their areas.
The next best of the big cities is Joburg on 6 %, with similar percentages for the rest (6 % for Port Elizabeth, 5 % for Pretoria and 5 % for Ethekwini),