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Bloemfontein’s booming with first-home buyers – outpacing Johannesburg’s residential rebound

Business Insider SA
Bloemfontein (Photo by Christopher Furlong/Getty Images)
Bloemfontein (Photo by Christopher Furlong/Getty Images)
  • Almost 8,700 properties in Bloemfontein were sold in 2021, up 30% from the year prior and representing an eight-year high.
  • That's a better rebound from the coronavirus-induced slump than Johannesburg, which is only up 22%.
  • First-time homebuyers are driving the property boom in Bloemfontein and opting for affordable sectional title properties priced under R1 million.
  • For more stories go to www.BusinessInsider.co.za.

Bloemfontein's residential property sector is experiencing a boom, driven primarily by first-home buyers, with sales reaching an eight-year high in 2021 and outpacing the rebound witnessed in Johannesburg.

The two-year-long Covid-19 pandemic has shifted property trends, with terms like "Zoom" and "Boom" being assigned to towns that have seen an influx of new residents taking advantage of the ability to work remotely.

Bloemfontein breaks the mould. It's not a small town and doesn't offer a drastic change in the form of a better work-life balance when compared to other metros. But according to at least one property expert, supported by sales data gleaned from the deeds office, Bloemfontein could be South Africa's next boomtown.

"Bloemfontein looks to be the next boomtown. It's appealing to buyers from Gauteng and even the Western Cape, according to recent Lightstone data," said Carl Coetzee, CEO of BetterBond.

Almost 8,700 properties in Bloemfontein were sold in 2021, up 30% from the year prior, when the market was thrown into a tailspin because of the Covid-19 pandemic. Data supplied by the deeds office and published by Property24 – tracking annual property sales back to 2013 – shows that 2021 was Bloemfontein's busiest year on record.

And while major metros like Cape Town and Durban recorded higher sales increases following the 2020 lull – 42% and 54%, respectively – Bloemfontein's rebound has outpaced Johannesburg's and shows little sign of slowing down.

Johannesburg's property sales increased by just 22% in 2021 and remain well below the eight-year average.

Bloemfontein's property boom is being driven by first-time buyers, with almost 70% of buyers between the ages of 18 and 49, representing a higher percentage in that age bracket than South Africa's national average.

The majority of Bloemfontein's new home buyers have opted for sectional title properties, which, according to Audrey Pretorius, BetterBond Regional Manager for the Free State, comes as no surprise, as first-time buyers generally opt for smaller, more secure, low-maintenance properties.

"We find that many younger buyers are not interested in large gardens which require upkeep, so they prefer sectional titles with smaller outdoor spaces that are maintained by a body corporate," said Pretorius, adding that new residential developments were opening up in Bloemfontein at affordable prices.

"The units are modern and new, which reduces the initial maintenance required."

The price of property in Bloemfontein has also escalated at a slower rate than the South African average, with affordability being one of the biggest drawcards for first-time buyers.

The average price of a property in South Africa has increased by more than 40% over the past eight years, while in Bloemfontein, properties are only 20% more expensive. The average price for sectional title properties in Bloemfontein is just over R900,000.

"This makes sectional title properties affordable for first-home buyers who may not have the financial reserves to cover the transfer duty required for properties of over R1 million," said Coetzee.

Schooling, like Grey College and St Andrews, also plays a major role in Bloemfontein attracting new homeowners, according to Coetzee.

"Our schools are world-class and cheaper to attend than many private schools elsewhere in the country."

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