Is Investing in Property in Johannesburg a Smart Move?
Category News
In short? YES!
Investing in property can be a lucrative venture. But is it a wise move currently?
Is it a better idea to invest in lucrative, or developing areas?
RE/MAX Advantage, experts in the area, took a comprehensive look at this question.
Luke Fraser from Business Tech said that The Bureau for Economic Research (BER) previously estimated that South Africa's GDP would increase by 2,2% in 2025. This would be the fastest growth rate in over a decade, excluding 2021, which saw a rebound from the pandemic-induced recession.
As of late 2023, the South African real estate market presents both opportunities and challenges. As the world navigates through post-pandemic recovery, Johannesburg stands out as a beacon of opportunity in the property market. With its unique blend of economic potential, urban development, and cultural vibrancy, 2025 is set to be a pivotal year for real estate investments in Joburg. There are several compelling reasons to consider investing in property in Johannesburg in 2025.
From luxury apartments in Sandton, family homes in the suburbs, or commercial properties and student housing, Johannesburg offers a diverse range of property types catering to various market segments. RE/MAX Advantage specialises in all of these areas and allows investors to tailor their portfolios to meet specific demographic needs, whether it's high-end developments or affordable housing. According to Numbeo, the property price-to-rent ratio in Johannesburg is around 10.4, which is one of the lowest in the world. If your price to rent ratio is less than 15, it's an excellent time to invest. A lower ratio indicates that the property has good potential to generate long-term returns, while a higher ratio suggests that the property may not provide adequate returns over time. (Rohd, 2024)
Johannesburg, as the largest city in South Africa and a key financial hub, has shown remarkable resilience in the face of economic challenges. By 2025, forecasts suggest continued economic recovery and growth, driven by sectors such as finance, technology, and tourism. The city is positioned to attract both local and international investors, which will likely boost property values and rental demand.
The rental market remains robust, with a growing demand for affordable rental properties. Areas surrounding the universities (I.e. WITS and The University of Johannesburg) like Melville, Auckland Park, and Westdene, or major businesses from affluent areas such as Sandton, Hyde Park, and Melrose, often see high tenant demand, making them ideal for investment. Investors should consider the potential for rental income alongside capital appreciation.
Despite its economic potential, property prices in Johannesburg remain relatively affordable compared to other major global cities. In 2025, this affordability will continue to attract first-time buyers and investors looking for rental properties. The potential for capital appreciation is significant as the demand for housing increases, particularly in well-located suburbs and emerging neighbourhoods.
Johannesburg is increasingly being recognised as a tech hub in Africa as well, with a burgeoning startup ecosystem and initiatives supporting innovation. As tech companies establish their presence in the city, the demand for modern office spaces and residential properties nearby will likely surge, presenting further investment opportunities.
Consulting with real estate professionals from RE/MAX Advantage and conducting comprehensive due diligence can help mitigate risks and enhance investment outcomes.
Investing in property in Johannesburg in 2025 presents a unique opportunity to capitalise on the city's economic growth, infrastructure development, and cultural vibrancy. With affordable prices, a strong rental market, and diverse property options, Johannesburg stands as a promising landscape for both new and seasoned investors. As the city continues to evolve, those who invest now may reap significant rewards in the years to come. Get in touch with an agent at RE/MAX Advantage to get expert advice.
Author: Madelein Schutte
