MAIN IMAGE: John Loos – independent economist
John Loos
The Western Cape residential property market is likely to remain South Africa’s top performer in 2026, according to independent economist John Loos.
While rising property prices and rental costs have raised concerns about affordability, Loos says there is little evidence that the province’s long-running inflow of skilled and higher-income households has reversed.
Outperformance continues despite affordability pressures
House prices in the Western Cape have risen significantly faster than in other major provinces over the past decade. Statistics South Africa data shows that between January 2010 and September 2025, average house prices in the province increased by 179.6%, compared with 79.7% in Gauteng and 76.7% in KwaZulu-Natal.
Rental inflation has followed a similar pattern. From January 2010 to January 2026, residential rentals in the Western Cape rose by 128.6%, far above Gauteng’s 63.8% and KwaZulu-Natal’s 76.9%.
Despite the growing affordability gap, Loos notes that there is currently little hard evidence of a meaningful “reverse semigration” back to Gauteng.
Migration data from the relocation platform Wise Move have continued to show net inflows into the Western Cape and net outflows from Gauteng, particularly among skilled, middle- to higher-income households.
More than semigration is driving the market
According to Loos, semigration alone does not explain the province’s sustained property strength.
Over the past two decades, the Western Cape has attracted a large number of skilled professionals. This has gradually strengthened the province’s skills base, purchasing power and economic growth prospects, factors that continue to support housing demand.
Better infrastructure, governance and service delivery in many municipalities have also reinforced the region’s appeal to both businesses and residents.
These structural advantages mean that local economic growth and job creation are increasingly supporting housing demand alongside migration trends.
Shift within the Western Cape property market
While the province is expected to outperform nationally, Loos believes the strongest price growth may increasingly occur outside the City of Cape Town metro.
As housing in the metro becomes less affordable, many buyers and migrants are looking to other coastal areas. Towns in the Southern Cape, such as George and Mossel Bay, as well as parts of the West Coast, have seen growing interest in recent years.
Data also shows that the house price growth gap between Cape Town and the broader Western Cape has narrowed since 2017 and even turned negative in 2022, suggesting stronger performance in smaller regional markets.
Coastal migration trend may expand
Loos also suggests that semigration could gradually spread beyond the Western Cape to other coastal regions.
Recent relocation data has shown net inward migration into the Eastern Cape, which may indicate that buyers are searching for more affordable coastal alternatives as property prices in the Western Cape continue to rise.
For now, however, the province still appears well positioned to maintain its status as South Africa’s strongest housing market.
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