Amazing Facts About South Africa’s Real Estate Market
When you imagine Africa, pictures of lions, zebras and other wild animals immediately come to mind. But truth is, these days, the continent is quickly developing and it is improbable that you will find any wild creatures in the streets. African countries are even some of the fastest growing economies in 2018, with Ethiopia being the top 5 globally.
Apart from economic progress, populations across African countries have also climbed dramatically in the last few years, ushering in a huge housing and commercial space demand. This is behind Africa’s transformation as a global property investment hotspot.
Here are some of the more surprising facts concerning the continent’s bustling real estate market:
Most developers are not Africans.
Foreign investment is dominating the real estate market in Africa, where investors are usually either Asians, Russians or Middle Easterners. Part of the appeal are the continent’s roaring tourism industry and favorable exchange rates. International hotel groups are relentlessly expanding their African portfolios but tourism is just one of the attractions.
Housing is generally cheap.
High-end homes are affordable to only a few Africans. This is why luxury properties in the continent are mostly owned by foreigners. If you intend to make a long-term investment, you might find affordable housing risky. You may pocket a bigger profit after selling one luxury villa than many low-cost properties. For starters, you have to find a local mortgage provider for low-income households.
Even with a price as low $10,000 for a basic urban unit, most Africans will probably still find it expensive. Yet all throughout Africa, there remains a tremendous need for such type of dwelling. However, if you want to uplift others’ lives as part of your mission as a developer, then there is great reward in going this direction.
Nigeria is rising.
After suffering the most catastrophic recession in more than two decades, Nigeria is establishing a reputation for its rapidly growing technology and agriculture sectors. Facebook and Google themselves have chosen Lagos as the base for their African headquarters.
South African real estate is on top.
Even with South Africa’s seemingly endless corruption problems, it remains a an attractive investment hub. Cost of living is highly affordable, while the rand stays weak against most foreign currencies. Cheap housing is accessible all throughout, and its tourism sector is the best it has ever been. International investors are constantly putting money into the areas of recreation and accommodation.
Sometimes, it gets complicated.
Africa is far from a simple continent, what with its entire range of cultures and nationalities, where you will find property laws just as diverse as its people. When purchasing land, you typically have to pay 50% down. In certain countries, such as Mozambique, only the government can own land. In any case, before investing in African real estate, it is best to learn more about it through research.