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While foreign buyers accounted for only a small share of South Africa’s residential property market over the past decade, they remained a dominant force at the luxury end, where they bought nearly two out of every five homes worth more than R20m.New data from Lightstone shows that foreign buyers accounted for about 6% of the roughly 2.39-million residential transactions recorded in 2016-25. The analysis covers purchases by individuals and excludes transactions involving companies and trusts.However, their presence increased sharply as property values rose. Foreign buyers made up 15% of transactions for homes priced at R4m-R10m and 26% for properties worth R10m-R20m.“While foreign buyers made up a relatively small proportion of the period’s transactions, they accounted for 39% of transactions on properties valued above R20m. That means two out of every five homes valued at more than R20m were bought by a foreign buyer,” said managing executive for real estate services at Lightstone, Hayley Ivins-Downes.The report challenges the perception that foreign investment is limited to Cape Town’s luxury coastal suburbs.Though the Western Cape recorded the highest share of foreign buyers at 7.8%, Gauteng followed closely at 7.3%. For homes valued above R1m, Johannesburg overtook Cape Town, with foreign buyers accounting for 15.3% of transactions compared with 12.7% in the Mother City.While foreign buyers made up a relatively small proportion of the period’s transactions, they accounted for 39% of transactions on properties valued above R20m. That means two out of every five homes valued at more than R20m were bought by a foreign buyer.— Hayley Ivins-Downes, managing executive for real estate services at LightstoneIvins-Downes said the findings pointed to different motivations behind foreign purchases across the country.“While the popular discussion of foreign property buyers has focused almost exclusively on leisure and lifestyle, the reality is far more nuanced. Johannesburg’s established immigrant communities have driven significant buying activity, while lifestyle markets in the Western Cape and Limpopo continue to attract affluent international purchasers,” she said. Cape Town nevertheless remained the country’s biggest destination for foreign capital. Lightstone estimates that foreign buyers spent about R153bn on residential property in the city over the decade, compared with R107bn in Johannesburg.Some of the strongest concentrations of foreign ownership were recorded in Cape Town’s Atlantic Seaboard. In Llandudno, nearly two-thirds of homes sold over the period were bought by foreign buyers at an average price of R29.2m. Bakoven, Camps Bay, Constantia and Bishopscourt also recorded high levels of foreign participation.Beyond the Western Cape, foreign buyers were active in Limpopo’s game estate market around Hoedspruit, lifestyle towns such as McGregor and Riebeek Kasteel, KwaZulu-Natal’s North Coast, and Johannesburg suburbs including Mayfair, Cyrildene and Yeoville, where established immigrant communities have driven demand.Ivins-Downes said the findings showed there was no single profile of a foreign property buyer.“Foreign ownership in South Africa is far more diverse than many assume. Some buyers are purchasing trophy homes and lifestyle properties, while others are buying into established communities or investing in locations linked to business and family networks,” she said.
