Five property trends for 2023

Key economic drivers from last year such as the war in Europe, gradual interest rate hikes and mounting inflation are expected to linger well into 2023. 

According to Carl Coetzee, CEO of BetterBond, this will significantly impact affordability and give a rise to prudent consumer budgeting.

From a property development perspective, it is likely to mean lower house prices. 

‘BetterBond expects house prices to soften over the next few months as we reach the peak of the rates’ hike cycle. However, challenging economic times, we are still seeing a steady demand for bonds across most price bands and regions.’

Looking ahead, Coetzee identifies these five trends for the housing market in 2023:

1. Sustainability is top of mind

The 2023 property buyer is demanding sustainability which is reflected in everything from materials used during construction to things like blinds, energy-efficient light bulbs, and greener appliances. 

‘South Africa’s ongoing load shedding saga has made alternative energy supply a top priority for many buyers. Solar energy options, boreholes, and other green features that can help reduce utility costs that adds value to the home in the long-term is essential,’ he says.

2. Sectional title still going strong

Almost a third of all property sales in 2022 were for sectional titles, and this number is expecting to increase over the next 12 months. 

Most sectional title homes are purchased by first-time buyers investing in new developments. ‘We have seen significant interest in sectional title properties in the past few years, accounting for between 37% and 44% of stock value,’ says Coetzee.

3. Semigration is changing route

According to Coetzee, semigration will gain momentum this year and while this is nothing new, the direction is. In the past, South Africans have been moving in droves to the Western Cape, where they usually tend to purchase a property that is larger in size but lower in value compared to where they were originally. 

‘Interestingly, we are now seeing a partial return of buyers between the ages of 36 to 49 who are at the upper end of the market, moving back to parts of Gauteng. Many choose to settle in estates that offer security and an appealing lifestyle,’ he adds.

4. Growing demand for estate living

Security has always been a top priority for home buyers but demand for estate living has grown substantially thanks to the pandemic. Many companies have embraced a hybrid working model, so being able to work, live and play in one environment is now key for buyers. 

‘During Covid, we learned the importance of being able to enjoy amenities and recreational activities within a controlled environment. In Gauteng particularly, there has been a steady increase in the value of estate homes,’ explains Coetzee.

5. Small is the new big

Younger property buyers between the ages of 25 and 34 are embracing the international micro-living trend full on. This takes the lock-up-and-go idea one step further, with a completely minimalist way of life allowing for comfortable living in units that can be just 24m2. 

‘We are seeing demand increasing for micro units in mixed-use developments that offer residents access to restaurants, shops and other amenities within the building,’ concludes Coetzee.