Cost of living in South Africa

The cost of living in South Africa

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Prices in South Africa are likely to differ to that of your home country. Use this guide to see if you can afford to purchase real estate in South Africa, attend school, set up utilities, dine out, and more.

The cost of living in the South Africa is higher than you might expect thanks to an emerging economy and the strengthening of the rand. However, South Africa is still a much more affordable country to live in than most European, Asian and North American cities. This guide gives you an in-depth overview of living costs in South Africa including housing, healthcare, public transport, groceries, childcare, taxes and entertainment

The economy is South Africa is on the rise. Although the rand experiences a lot of fluctuation, banking, commerce and basic infrastructure rivals other developing countries. Industries including manufacturing, service, agriculture and mining are also flourishing and the rand is performing well against other currencies. 

As a result, the cost of living in South Africa is not as cheap for expats as it used to be. Having said that, the general cost of living is considerably cheaper than the majority of popular cities around the world. Eating out, beer and entertainment can be as much as 50% lower in South Africa than they are in Europe. Clothing and consumer items, on the other hand, are only marginally less expensive in South Africa.

Cost of living in South Africa

South Africa has made a lot of progress in the last 30 years or so. Absolute poverty has been significantly reduced thanks to a series of community programs and social grants. Substantial investment has also seen a vast improvement in education, housing and basic infrastructure. However, many jobs are still low-paid. The average disposal income in South Africa is $8712 a year which is well below the OECD average of $29,016.

In Mercers Quality of Living Survey, three South African cities ranked in the top 100; Durban was ranked the highest at 87th, whilst Cape (94) and Johannesburg (96) were not far behind.

Durban tops the best cities in South Africa thanks to its lower rental prices which are around 50% lower than Cape Town. For the same standard of living, your money goes a lot further in Durban than any other South African city.

Below is a breakdown of how much it costs to live in the most popular South African cities compared to other major cities in the world, but if you want to compare the cost of living between South African cities, this article will give you a good insight.

Cost of living in South Africa: Johannesburg 

  • 61 percent less expensive than Zurich
  • 58 percent less expensive than New York
  • 53 percent more expensive than London
  • 30 percent more expensive than Brussels
  • 46 percent more expensive than Paris
  • 49 percent less expensive than Tokyo
  • 22 percent more expensive than Rio de Janeiro
  • 47 percent more expensive than Los Angeles

Cost of living in South Africa: Cape Town 

  • 63 percent less expensive than Zurich
  • 60 percent less expensive than New York
  • 55 percent more expensive than London
  • 32 percent more expensive than Brussels
  • 48 percent more expensive than Paris
  • 51 percent less expensive than Tokyo
  • 24 percent more expensive than Rio de Janeiro
  • 49 percent more expensive than Los Angeles 

Cost of living in South Africa: Durban 

  • 66 percent less expensive than Zurich
  • 63 percent less expensive than New York
  • 58 percent more expensive than London
  • 35 percent more expensive than Brussels
  • 51 percent more expensive than Paris
  • 54 percent less expensive than Tokyo
  • 27 percent more expensive than Rio de Janeiro
  • 52 percent more expensive than Los Angeles 

Cost of living in South Africa: Port Elizabeth 

  • 66 percent less expensive than Zurich
  • 63 percent less expensive than New York
  • 58 percent more expensive than London
  • 35 percent more expensive than Brussels
  • 51 percent more expensive than Paris
  • 54 percent less expensive than Tokyo
  • 27 percent more expensive than Rio de Janeiro
  • 52 percent more expensive than Los Angeles 

Cost of living in South Africa: Bloemfontein 

  • 65 percent less expensive than Zurich
  • 62 percent less expensive than New York
  • 57 percent more expensive than London
  • 34 percent more expensive than Brussels
  • 50 percent more expensive than Paris
  • 53 percent less expensive than Tokyo
  • 26 percent more expensive than Rio de Janeiro
  • 51 percent more expensive than Los Angeles 
Prices in South Africa: Locations

Cost of real estate in South Africa

Property in South Africa is significantly lower than most European countries, North America, Australia and much of Asia. Furthermore, foreigners are free to purchase property in South Africa with limited restrictions. The only condition is that property must be endorsed as ‘non-resident’ even if you are living in the country full-time as non-residents have to pay capital gains tax when you sell the property.

Although the average house price in the middle and higher end of the market has seen an increase of around 3% since 2014, expats looking to buy property in South Africa can expect to pay around $80,000 - $200,000. A 5-bedroomed house will cost around $500,000-$600,000.

Renting a house is also very affordable for expats living in the suburbs, but it’s a different story in the city centre. You can pick up a three-bedroomed house with a front and back garden for around $550-$700 whereas an equivalent apartment in the city is $1000-$1200.

Cost of living in South Africa: Utilities - water, gas, electricity

The average utility costs in South Africa are still riding the middle wave compared to other countries despite the countries power plants issuing a 9.4% hike in utility bills in 2015. According to Numbeo, utility bills cost between $48 and $140 a month depending on the size of your house. Utility costs cover water, electricity, gas and waste disposal.

Broadband and TV costs are comparable to most European countries. Basic broadband packages in South Africa start from around $15 but can be as much as $38. TV licenses in South Africa are $20.54 for the first year and must be paid in full. After the first year, you can pay monthly at a rate of $2.17. Late payments incur a 10% penalty so it is easier to set up a direct debit. Alternatively, you can pay online or at the Post Office.

Cost of living in South Africa: Utilities

Public transport prices in South Africa

South Africa has one of the least expensive transport systems in the world although most people use taxis. The average monthly expenditure on transport is as low as $38-$45 for buses and trains.

Public transport is fairly limited in South Africa and most people use private shuttle buses. The average cost for a one-way journey is $0.45.

Taxis are also inexpensive and range between $4 and $8 for short journeys. You have to phone ahead and order taxis ahead of schedule though. You can’t just flag them down in the street.

Grocery prices in South Africa

Prices for general foodstuffs in South Africa is very affordable for expats that earn a reasonable salary. The average grocery bill for essentials is estimated to be around $162-$200. Because most fruit, vegetables and meat is sourced locally, prices are kept low. Staples such as milk and bread are only around $0.78 whilst rice and eggs are $1.40. However, luxury items and imported foods, including potatoes, are slightly higher and can increase the cost of your shopping bill.

Grocery prices in South Africa

Prices in South Africa: Education

There is no free education system in South Africa and the Government’s announcement to increase costs by 9.5% a year from 2017 sparked nationwide protests. However, for most expats, the cost of educating your child at a private school in South Africa is probably less expensive than your own country. It is estimated that a child starting school in 2017 and finishing in 2035 will cost between $100,000 in a public school and $234,000 in a private school.

For example, in 2017, the average cost of a private education in a primary school is $6000 a year going up to $9477 in 2022. You can read more about the progression of school fees in the article.

It should be noted that many schools in South Africa allow you to choose how often your child attends school; half day, full day or for three-quarters of the day. This structure also affects costs.

South Africa only has 23 public Universities and the cost of an education in the country is considerably higher than many European countries. However, students should also factor in general living costs which are considerably lower in South Africa than Europe or North America.

Universities fees in Cape Town start at $5438 a year plus an international student fee of $2719. You should also consider expenses for stationery and books which is around $450 a year. Courses at Witwatersrand range from $7356 to $13.810 a year. 

Healthcare costs in South Africa 

The healthcare system is at odds in South Africa. Despite a spate of Government reforms, healthcare for most South Africans is unaffordable. Yet it is highly advisable for expats to take out private healthcare for the entire family.

The cost of private health insurance varies considerably. On average healthcare insurance ranges between $77 and $155 a month for a family of four. Check that policies also cover you for future health requirements. Prices go up the older you get although there are retirement groups that have insurance policies with organisations that offer lower rates.

When you take out health insurance, read the policy carefully to determine what it covers. Avoid companies that reserve the right to cancel a policy if you have a critical illness or reach a certain age. Most insurance policies only cover you for 5-years.

Cost of living in South Africa: Healthcare

Childcare prices in South Africa

Parents that work full-time have plenty of childcare options in South Africa. The most cost-effective method is to hire a nanny. They charge between $380-$900 a month depending on their age, experience and where you live. Some nannies, or night nurses, can also take care of your child overnight for $22-$30, which is less expensive than a baby-sitter that charges between $3.50-$5 an hour.

Families that hire an au pair to look after your children are recommended to offer between $3.50-$60 an hour depending on experience and qualifications. Also, au pairs that work less hours demand a higher hourly rate to compensate for the loss of earnings.

Au Pairs must also be offered a room and meals. Travel expenses on behalf of the family should also be remunerated. Rather than calculating the exact amount, a set amount of $0.23-$0.31 per kilometer is agreed.

Prices in South African restaurants

The cost of dining out is relatively inexpensive compared to many other countries around the world. Of course, the cost of a meal depends where you choose to eat as there are high-end restaurants in South Africa that can be costly yet still around half the price you would pay for a comparable meal in Europe, Australia, North America and most countries in Asia.

Furthermore, the quality of fish, meat, salad and vegetables is very good and South African restaurants take pride in the presentation of meals. It’s possible to enjoy a gourmet four course meal for around $40-$45 per person. Wine is also inexpensive and good quality in most restaurants, but it is a custom to allow diners to bring your own bottle and charge a corkage fee of around $3.

In general, a lunchtime meal will cost no more than $8. Fast foods such as a McDonalds Value Meal is under $5 and sandwiches are around $3. Evening meals in an inexpensive mid-range restaurant will cost on average between $15 and $35.

Prices in South African restaurants

Cost of living in South Africa: Taxes

If you have been living and working in South Africa for more than 183 days, you are eligible to pay personal income tax on your personal income. This includes a monthly salary and income you receive from overseas capital such as rent.

Tax calculations in South Africa is complex. Each tax bracket has to pay a set taxable rate and then a percentage of earnings over the amount set by each tax bracket. Tax rates in South Africa range from 18% to 45% depending as follows:

  • Up to $18,500 – 18%
  • $18,501-22,698, – $2616 plus 26% of taxable income above $18,500
  • $22,699-31,417 – $4738 plus 31% of taxable income above $22,698
  • $31,418-45527 – $7442 plus 36% of taxable income above $31,417
  • $45528-54216 – $11,441 plus 39% of taxable income above $45,527
  • $54217-114814 – $15,999 plus 41% of taxable income above $54216
  • Over $114,815 – $40845 plus 45% of taxable income over $15,999

 

For more information about your potential tax liabilities in South Africa, see our comprehensive guide here

Social security and pension prices in South Africa 

The social security system in South Africa is complex. Payments cover pension, sickness, maternity, old age care, war veterans, disability and death. The current rate stands at 2% and is paid by employers.

However, workers have the option to take out their own pension plan to save for retirement. Drawing social security is means tested based on the duration you worked in South Africa and the amount paid in relation to your earnings. 

For more detailed information about the social security system in the South Africa check out our comprehensive guide here

For more information on economic indicators such as consume inflation and tax news visit the National Statistics website for South Africa.

 

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