More foreigners are now buying SA properties; these are their favourite areas
- A new FNB report shows residential property sales to foreigners are on the rise in South Africa.
- But foreign buying is still below a 2016 high, when one in twenty homes was sold to foreigners.
- Coastal cities, outside of Cape Town, saw the biggest increase in sales attributed to foreigners.
- For more stories, go to Business Insider SA.
Residential property sales attributed to foreigners in South Africa increased by more than 20% since the end of 2018, a new report by FNB shows.
The First National Bank (FNB) Estate Agents Barometer, released on Wednesday, shows that an estimated 3.74% of all residential properties sold in 2019’s second quarter (April to June) were sold to foreigners, up from 2.98% at the end of 2018.
In the first quarter of 2019, an estimated 3.61% of residential property was sold to foreigners.
“The improvement in the first half of the year suggests that while many aspiring homeowners may have sat on their hands during the national election period, foreigners – presumably wealthy – used the opportunity to acquire domestic assets, most likely at a significant discount,” FNB’s Siphamandla Mkhwanazi said.
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The increase in foreign buying notwithstanding, the level of such acquisitions by foreigners is still far below 2016’s third quarter (July to September) peak of 5.72%, as well as the 4.4% long-term average.
The report shows that while foreign buying is on the increase, sales to foreigners is playing a less prominent role in the Cape Town property market.
Sales attributed to foreigners in Cape Town has come down from a recent high of 10.7% in 2018’s second quarter to 6.5% in 2019’s second quarter.
Instead, coastal cities such as Durban and Port Elizabeth are seeing an increase in foreign buying, possibly in the holiday home market, the report says.
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Residential sales attribute to foreign buyers grew to 1.9% in the second quarter in Port Elizabeth, and to 5.1% in Durban.
In Johannesburg, residential sales attributed to foreigners rose from 2.6% at the end of 2018 to 4.7% in the second quarter of 2019, while in Tshwane it declined from 2.4% to 1.3%.
The FNB Estate Agents Barometer is compiled by surveying agents, predominantly in South Africa’s six major metros, asking them the estimates of foreigners buying homes as a percentage of the total domestic sales in their area.
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