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Data reveals the rising trend in affordable housing in the Western Cape

5 Sep 2024

The Western Cape housing market is characterised by a diverse range of housing options, catering to a wide spectrum of income levels. A significant portion of the housing stock falls into the subsidised and mid-level categories, reflecting the government's efforts to address housing affordability and the evolving needs of the population.

Source: 123RF

Lightstone - provider of data, analytics, and systems for property, and automotive and business assets - shows that nearly 510,000 housing units in the Western Cape are valued at under R750k, which accounts for 40% of the total housing stock (1.277m) in the province.

Three out of four properties are subsidised units, which includes RDP and BNG houses, state-subsidised units, and old municipal stock. Mid-level properties, valued at between R250k-R750k account for 22% of the stock, and affordable houses, valued at under R250k, make up 4%.

Hayley Ivins-Downes, managing executive real estate at Lightstone, says new stock coming onto the market demonstrates the dominance of subsidised housing in the market, with limited affordable stock coming onto the market from 2019 to 2022, but this accelerated in 2023 and into 2024.

Subsidised housing dominance

Ivins-Downes, said the dominance of subsidised housing is evident in new stock coming onto the market. While limited affordable housing was added from 2019 to 2022, this trend accelerated in 2023 and into 2024. This suggests a growing focus on addressing the needs of a wider range of buyers.

Half the stock is concentrated in seven areas, namely Cape Town itself with 16%, Khayelitsha (9%), Mitchells Plein (8%), BlueDowns (8%), Gugulethu (6%), George (3%), and Strand (2%).

The top five places remain the same (although Blue Downs and Mitchells Plain swop places). If we look at the top 20 areas in terms of volume of sales in 2023 to date, we see Eerste Rivier, City of Cape Town NU, and Atlantis recording more sales than Strand or George.

Average sales prices are highest in Mitchells Plain, Strand, Brackenfell, Milnerton, and Parow, and lowest in Swartland NU and Grabouw.

The value of mid-level and subsidised sales in the Western Cape has been steadily rising over the past 10 years, while the average sales price of affordable homes has shown marginal improvement over the period under review.

“The average sales price of mid-level and subsidised houses in Cape Town mirrors the trajectory in the Western Cape, while movements in the affordable category have been erratic, and the affordable average sales price is the same in nominal terms over 10 years,” said Ivins-Downes.