Affordability pressures have grown more acute, even as financial conditions remain bolstered by lower real interest rates, a strengthening of foreign sentiment toward SA, and the resilience of commodity export prices.
On Wednesday, June 17, Statistics South Africa (Stats SA) announced that consumer inflation jumped to 4.5% in May from 4.0% in April, reaching the highest rate since July 2024, when it was 4.6%. The monthly change in the consumer price index (CPI) was 0.7% in May.
A breakdown of the CPI components shows that property owners and tenants are facing a much higher inflationary environment, reducing housing affordability, says Emeritus Professor François Viruly, a property/real estate economist and chief economist at Datazone.
He says to start with, the CPI for administered prices (which includes electricity, water, and municipal charges) increased by a staggering 13.7% (May 2026 vs May 2025).
“This reflects a strong upward trajectory in 2026, from 3.7% in January, 1.7% in February, 2.1% in March and 8.3% in April. Fuel prices increased by 28.7%.”
