2026: The window of opportunity for South African homebuyers

Image: Menlyn Park residential development

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• Lower interest rates and deposits are restoring affordability and pulling first-time buyers back into the market.
• A stronger rand, economic recovery and easing inflation are creating the most buyer-friendly conditions in three years.
• Rising demand and regional price growth signal that waiting too long could mean paying more later.

2026: A strategic moment to enter the market

‍With affordability improving across multiple fronts, 2026 is emerging as a defining year for aspiring homeowners and investors. Lower deposit requirements, easing lending conditions and the cumulative 150-basis-point drop in the prime lending rate since late 2023 are materially reducing the cost of entry into the housing market.

According to Bradd Bendall, National Head of Sales at BetterBond, the question many households are now asking is no longer if they should buy, but when. And the data increasingly points to “now” as a compelling answer.

At the current prime lending rate of 10.25%, a buyer financing a R2 million home over 20 years pays around R19,633 a month, roughly R2,000 less than in 2023. Over the life of the loan, that translates into nearly half a million rand in interest savings. For many households, this shift alone moves ownership back within reach.

Economic tailwinds are turning positive

‍The broader economic backdrop is also becoming more supportive. A resilient rand, which strengthened nearly 14% year-on-year by the end of 2025, is helping to contain inflation and improve purchasing power. This, in turn, opens the door for further interest rate cuts in 2026.

GDP growth is forecast between 1.5% and 2% are modest, but a meaningful improvement on the stagnation of recent years. Strong commodity exports, improved energy security through private solar generation, and growing investment confidence are all contributing to a more stable environment for long-term property decisions.

For investors, sustainability features such as rooftop solar are now more than lifestyle upgrades, they are value drivers, enhancing rental resilience and future-proofing assets, particularly in high-demand regions like the Western Cape.

Demand is returning and so are price pressures

‍The recovery is already visible in buyer behaviour. BetterBond recorded a 14.6% year-on-year increase in bond applications by the third quarter of 2025, with applications for properties above R3 million jumping by 44%. This points to renewed confidence at both the entry and premium ends of the market.

House prices are responding. National growth is back above inflation in several regions, led by the Western Cape, Mpumalanga, KwaZulu-Natal and Greater Pretoria.

The Western Cape continues to outperform, with average prices around R2.1 million, more than 40% above the national average, reflecting semigration, lifestyle demand and infrastructure reliability.

While first-time buyer prices are rising more moderately, the average purchase price has reached a record R1.3 million, reinforcing the importance of timing: affordability is improving, but the longer buyers wait, the more capital they may need.

Deposits are easing and access is improving

‍Perhaps the most encouraging signal for new entrants is the decline in deposit requirements. First-time buyer deposits fell 15% year-on-year and are now at their lowest levels since 2022. The gap between deposits for first-time and repeat buyers is narrowing, showing that banks are once again competing for new business and relaxing risk appetite.

Although deposits remain higher than pre-2022 levels, the direction of travel is clearly positive and that matters for younger buyers and professionals who have the income but not yet the accumulated capital.

What buyers should do now

‍For those considering a purchase in 2026, the message is clear:
This is a window of opportunity, but it will not remain open indefinitely.

Practical next steps include:

• Securing bond pre-approval to understand true affordability and strengthen negotiating power.
• Locking in rates while the interest cycle is favourable.
• Focusing on regions with strong economic fundamentals, infrastructure and long-term demand.
• Acting before renewed demand and further rate cuts push prices higher.

As Bendall notes, if the rate-cutting cycle continues, more buyers will enter the market, competition will intensify, and today’s affordability gains could quickly be absorbed by rising prices.

In short, 2026 is shaping up not just as a “good” year to buy, but as a strategic inflection point for those who want to secure property before the next growth phase accelerates.

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