Key Highlights :
1. South Africa's biggest property owners are increasingly reducing their exposure to Gauteng and shifting their focus to the Western Cape. This mirrors the entrenched trend to 'semigration' where those with the means have been steadily relocating to Cape Town or the Garden Route from other parts of the country.
2. Following the riots and floods in KwaZulu-Natal in recent years, sentiment in that region's residential property market has plummeted with 14% of sales due to relocation within the country (mostly to the Cape) – nearly double the pre-Covid rate.
3. Jones Lang LaSalle's recent South African Real Estate Investment Review and Outlook for 2022/23 says the Western Cape saw a 66% increase in direct investment in 2022 – taking its share of total investment in the country to nearly a quarter (23%) from 11% in 2021.
4. Gauteng's share fell from 68% to 52%.
5. FNB Commercial Property Finance strategist John Loos says that in the current 'weak economic and property rental market environment, rates and tariffs really start to matter far more to both landlords and tenants, and it is really not just about the level of rates and tariffs, but also about what quality of municipal and utilities' service is received in return'.
6. 'Such shifts in business activity geographically will escalate in the near future, given that many companies are increasingly financially constrained in a stagnant economy, and with many councils implementing above inflation rates and tariff increases while services and infrastructure deteriorate'.
7. Semigration is good for business. It said in its pre-close update in February that its investment universe is expanding with 'numerous new growth nodes being established within the Western Cape as semigration drives development growth'.
Region ‘appears to be increasingly outperforming the rest in terms of service delivery, infrastructure, market performance’.
According to a recent report, the region appears to be outperforming the rest in terms of service delivery, infrastructure, and market performance. The report was compiled by market research firm, Gartner, and it reflects the findings of a number of surveys that have been conducted over the past few years.
The report notes that the region has been able to improve its service delivery and infrastructure capabilities at a much faster rate than other regions. This has led to a rise in the region’s market share, and it is now the leading region in terms of market performance.
The report attributes the region’s success to a number of factors, including the growth of the digital economy, the increase in investment in infrastructure, and the development of a strong digital ecosystem.
The report notes that the region is now well-positioned to take advantage of the opportunities that are available in the global market. It is expected that the region will continue to outperform the rest in terms of service delivery, infrastructure, and market performance in the years to come.
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