The South African property market trembled nervously with the announcement by President Zuma that foreign land ownership will not be allowed in future.
In his State of the Nation address last week, Zuma said:
“Foreign nationals will not be allowed to own land in South Africa but will be eligible for long term lease.
In this regard, the Regulation of Land Holdings Bill will be submitted to Parliament this year.”
Details of the Regulation of Land Holdings Bill are sketchy at this stage as the proposed bill is “probably still being drafted”, said Judith February, a political commentator and senior associate at the Institute for Security Studies (ISS).
If the bill goes through, there will likely be a future cut-off date after which foreigners would be barred from buying South African property.
Instead, they would have the option of leases running “for a minimum of 30 years”.
Areas like the western seaboard suburbs of Cape Town and towns like Kynsna and Jeffreys Bay will all be materially impacted should foreign property owners be forced to sell and convert property to long term leases.
But it is not only foreigners who are likely to be affected by the proposed bill.
The Regulation of Land Holdings Bill intends to require all property buyers to disclose their gender and race on title deeds, in addition to nationality.