For many, owning a home is a lifelong dream, and property remains a tangible, often lucrative investment. However, before taking the plunge, it’s important to evaluate the factors that could influence your decision. Claude McKirby, Co-Principal of Lew Geffen Sotheby’s International Realty in Cape Town’s Southern suburbs, highlights the key considerations for prospective property buyers in 2025.

"A well-chosen property can yield significant returns through value appreciation or rental income. It can also hedge against inflation, providing security during uncertain economic times," says McKirby. "However, real estate is a substantial financial commitment, so buyers should carefully assess their readiness and the market conditions."

1. Assess Your Personal Finances

Key considerations include:

• Deposit and Savings: Most banks require a deposit of 10–20% of the home’s value. Additional costs such as transfer duties, bond registration fees, and legal fees can add 5–8% to the purchase price. Ensure you have sufficient savings to avoid financial strain.

• Debt and Credit Score: A strong credit score is vital for securing a competitive bond rate. Lenders also prefer a debt-to-income ratio where monthly debt repayments, including the bond, do not exceed 30% of monthly income.

Obtaining pre-approval from a bond originator like ooba can clarify how much you can afford and improve your chances of securing finance.

2. Interest Rates in 2025

Interest rates significantly impact mortgage repayments. In 2023, the South African Reserve Bank (SARB) raised rates to curb inflation. However, as inflation stabilises, interest rates are now on a downward trend.
"With ongoing political stability and relief from loadshedding, experts predict further reductions in the repo rate, which is encouraging for buyers," McKirby notes.

3. Market Conditions

Factors to evaluate include:

• Supply and Demand: Urban areas like Cape Town and Durban are experiencing housing shortages due to semigration, driving price growth in some suburbs. Emerging neighbourhoods, however, may offer more affordable opportunities.

• Government Policies: Tax adjustments, land reform, or changes to property laws can influence the market. Stay informed about these policies to make educated decisions.

Researching local property trends and consulting real estate agents will help identify areas with strong potential for growth or value.

4. Long-Term Investment Goals

Consider these strategies:

• Capital Growth: Focus on areas with improving infrastructure, proximity to schools, and business hubs, which tend to drive demand and property value.
• Rental Income: Urban rental demand remains strong in cities like Cape Town, Johannesburg, and Pretoria. Renting out a property can offset mortgage payments while its value appreciates.

5. Is Your Timing Right?

Your personal circumstances play a critical role.

• Are you ready to commit to a property for 5–10 years?
• Is your job stable, and does the property align with your family needs?

"The property market can be volatile in the short term, and selling too soon may not yield desired returns," McKirby advises.

Conclusion

The decision to buy property depends on your financial situation, long-term goals, and readiness for the responsibilities of homeownership. Claude McKirby encourages buyers to assess their finances, consider the economic context, and align their purchase with personal goals.

"Whether you’re a first-time buyer or expanding your portfolio, a well-thought-out decision today can lead to long-term success," McKirby concludes.

Press Release Submitted By

Company Name: Lew Geffen Sotheby’s International Realty
Contact Person: Claude McKirby

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Is 2025 the Year to Buy Property?
Claude McKirby from Lew Geffen Sotheby’s shares tips for navigating interest rates, personal finances, and market conditions. Plan wisely and invest with confidence!

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