The property market starts 2026 with good news and a stronger foundation compared to the prior year. Further rate cuts last year and a number of positive economic developments have paved the way for an improved economic and interest rate outlook for this year which is good news for the property market.
We have already seen the market gain momentum towards the end of last year, and expect further recovery off the back of the much-improved economic fundamentals. These include the stronger rand, record-low inflation, a supportive lending environment, and importantly, the potential for at least two further interest rate cuts this year.
While the Trump/US policies will remain influential, our optimistic outlook is supported by improved investor confidence, and notable strengthening of the Rand against the US Dollar, now trading at below USD17 this year. The inflation outlook remains at a historic low, and well within the proposed new SARB target range of 2-4%.
The interest rate is a strong driver of demand in the market, and we have already started seeing the positive impact of the interest rate cuts last year which has brought down the cost of home loans and improved affordability. We anticipate at least two further rate cuts, stimulated by the strong rand and low inflation.
This would further boost market activity and price growth. That said, we expect the “tale of two markets” to largely persist, with the Cape continuing to outpace Gauteng and other regions in demand and price appreciation. Where the Cape remains largely a seller’s market, Gauteng offers outstanding value as a buyer’s market with flat prices and an abundance of stock.
That may not always be the case, especially if a new government or coalition can turn the metro around. Buyers therefore have a unique opportunity to take advantage of relatively low prices, and gain long-term capital growth benefits.
The rental market is also set for another strong year, especially in urban areas where continued migration drives higher demand for rentals, and tight stock levels in turn offers opportunities for rental investors.
Positive outcomes from the local elections later this year could further accelerate the economic and property market recovery. In the meantime, opportunities abound in many areas for buyers and investors to take advantage where opportunities present.
Samuel Seeff
Chairman of the Seeff Property Group
