Home Housing Buying & Selling Buying a house in South Africa
Last update on June 03, 2020

If you’re planning on buying a house in South Africa, these expert tips and overview of costs can help you prepare for buying property in South Africa.

If you’re tempted by houses for sale in South Africa, there are no restrictions on foreigners buying property in South Africa, although lower mortgage limits typically apply. You can buy a home cheaply in South Africa, but it’s important to be aware of the extra fees involved. This guide explains the process of buying a property in South Africa and how to find houses for sale in South Africa.

Real estate market in South Africa

House prices have been relatively stable in South Africa, with home ownership levels at around the 60 percent of the population.

The average national price for an entry level home (80–140 sqm) is around ZAR 937,000 (USD 69,000), with an average medium-size house currently costing around ZAR 1,255,000 (USD 85,000). Despite steady increases in the last year, property prices in South Africa remain relatively low.

Foreign buyers are allowed to freely purchase property, although mortgage options are limited for non-resident buyers to just 50 percent of the property purchase price. The transaction costs of buying a home in South Africa should also be calculated in, which can range anywhere from 5–15 or more on top of your property price, with taxes depending on the price range of your property.

Should you buy property in South Africa?

In certain cases, houses for sale in South Africa can make financial sense considering that rental costs can be expensive, especially in large cities. You can read more in our guide to renting in South Africa.

Currency is another contributing factor. With the Rand (ZAR) devaluing in recent years, it’s now significantly cheaper than it was for foreign currency buyers to purchase homes in South Africa.

Although you can buy cheaply, those planning shorter stays in South Africa should consider capital gains tax, which are relatively high in South Africa and can eat into profits on short-term investments. Sellers are typically liable to pay capital gains tax of 33.3 percent on their profits, after deducting certain expenses.

How to find houses for sale in South Africa

Property for sale in South Africa is generally handled by real estate agents, and private sales are relatively rare. Estate agents in South Africa must be registered with the Estate Agency Affairs Board and agents are issued annually with a certificate that says they agree to comply with the latest code of conduct. Many agents are also members of the Institute of Estate Agents of South Africa. You can find a listing of housing services and real estate agents in South Africa.

You can also find real estate agents that will specialise selling in a particular area or focused on foreign buyers (including providing English-language services) particularly in more popular areas, for example, offering houses for sale in Cape Town, Pretoria, Durban and Johannesburg.

A traditional method of sourcing properties is registering your preferences with as many agents in the area as possible and hoping that they are diligent, patient and committed enough to find you the right home.
You’ll find many sites advertising properties, which can be a quick way to guage potential areas, prices and properties on offer. Read tips on how to choose the right real estate agent in South Africa

While details of the main national estate agencies are below, you can find smaller, local agencies by looking in the white pages or yellow pages.

Real estate agents in South Africa:

Building your own home in South Africa

Building your own home in South Africa is a viable option, although the financial benefits of doing so are open to debate.

Unlike some other countries, there are no government incentives offered to people building their own home, and while land can be purchased relatively cheaply, so too can existing properties.

Houses for sale South Africa

If you choose to build your own home, in addition to buying a plot of land (either from a house builder or privately) you’ll need to appoint an architect to design the property and a builder to turn your plans into reality. Architects are usually registered with the South African Institute of Architects, while house builders can be found by contacting the National Home Builders Registration Council.

Buying property in South Africa

Once you’ve found your ideal property in South Africa, you will need to make an offer – usually through the designated estate agent. The estate agent will request a formal letter confirming details of your offer (which can sometimes also include prospective completion dates), and this is sent to the seller to approve. If the seller agrees to accept the offer, both sides will sign the document, and it will then effectively work as a sale agreement.

The seller will now appoint a conveyancer to deal with the legal aspects of the transaction. While the seller usually gets to choose the conveyancer, the buyer pays their fees.

You’ll then need to submit identification documents to the Deeds Registry so you can be officially registered as the new owner. As in other countries, the legal process can be time consuming, often running to six to eight weeks.

Once you’ve been officially registered as the new owner, you’ll need to pay the remaining balance and the conveyancer will deliver the title deed.

Funding a purchase: deposits and mortgages

As a foreign buyer, you’ll typically need a deposit of at least 50 percent of the purchase price of the property if you are a non-resident. Read about South African visa and permit regulations.

Foreign nationals who are resident and working in South Africa or investors may be able to loan more at the bank’s discretion. All loans to foreign nationals are typically subject to approval from the South African Reserve Bank. Some banks will require you to set up a South African bank account so your mortgage payments can be debited, although this is not always the necessary as payments can be arranged from an international bank in some cases.

As with mortgages in other countries, the lender will conduct a property valuation before agreeing to lend you the money, and will sometimes base the amount they lend on their valuation, rather than the agreed purchase price.

Lenders tend to offer both fixed-rate and variable mortgages, although fixed-rate deals tend to be less popular at the moment as banks offer uncompetitive rates. While mortgages with terms of up to 30 years are available, it’s more common to take out a 20-year mortgage, and your loan will normally have to be paid off by the age of 70. Most mortgage products in South Africa don’t come with early redemption penalties.

As part of the home buying process, you’ll also need to take out building insurance. Read about insurance in South Africa.

Costs of buying property in South Africa

When you buy property in South Africa, you’ll typically need to pay transfer duty plus a registration fee and conveyancing fee.

Transfer duty is not applicable in all property sales, as it depends on the property price:

  • Up to ZAR 750,000: 0 percent
  • ZAR 750,000–1,250,000: 3 percent
  • ZAR 1,250,000–1,750,000: 5 percent
  • ZAR 1,750,000–2,250,000: 8 percent
  • ZAR 2,250,000+: 11 percent

Transfer duty is often paid through your conveyancer at the point of purchase, otherwise it must be paid within six months of agreeing to buy your home (not the date of the compled sale). If you don’t pay on time, you’ll be subject to interest at 10 percent per annum each month.

Property for sale South Africa

Registration fees are also due to finalise the property transfer:

  • Up to ZAR 150,000: ZAR 70
  • ZAR 150,000–300,000: ZAR 350
  • ZAR 300,000–500,000: ZAR 450
  • ZAR 500,000–1,000,000: ZAR 550
  • ZAR1,000,000 – 2,000,000: ZAR 650
  • ZAR2,000,000 – 5,000,000: ZAR 1,050
  • ZAR 5,000,000+: ZAR 1,250

Conveyancing fee depend on the provide and can range anywhere from ZAR 1,250–36,000 ZAR (plus VAT at 14 percent).

Selling property in South Africa

There are various ways to sell your home in South Africa. The most common is to appoint a local estate agent to market the property online and in-store. Alternatively, although less common, you can sell your property privately or use an online-only agent.

As with buying in South Africa, fees can be high. When you sell a property, you’ll need to pay estate agent fees of up to 8 percent of the sale price (plus 14 percent VAT). Estate agents’ commission is often open to negotiation, and can depend on whether you sign a sole agent agreement or an open agreement (where other agents are also allowed to market your property).

Capital gains tax charges are also due in South Africa, which can be quite high although several tax exemptions are allowed. After the deduction of transfer costs, property improvements, acquisition costs and an allowed annual deduction of ZAR 30,000, capital gains tax is charged at 33.3 percent of the remaining profit. Read about income taxes in South Africa.

Assistance when buying a house in South Africa

There are currently no home buying schemes available to foreign citizens living in South Africa, but government assistance in the form of a one-off grant is available for South African citizens with low earnings. This isn’t particularly useful to people who have just moved to the area, however, as you usually need to live in South Africa for five years before applying for citizenship.

Where to buy in South Africa?

Location, Location, Location

Everyone knows that the most important point to buying property is the area where it is located. What this means essentially is that it is sometimes advisable to downscale on the size or quality of house in favour of a better area. Find where to live in Cape Town


Once you have identified the area you want to buy in, consult with the local residents and the police station regarding the crime rate in the area. Look out for open tracts of land and developments going on in the neighbourhood, which could promote incidents of criminal activity. Read about the top five safest places to live in South Africa.


Also take note of the presence (or lack thereof) of schools, libraries, shopping centers and other facilities that you would require in the area.

Tips and advice when buying South African property

Mark Bellinger at Online-Property advises it is necessary to avoid the common pitfalls when making a property purchase, particularly abroad, considering buying your house or property is one of the biggest purchases you will make during your lifetime. Here are some things to consider to ensure your property purchase in South Africa is secure in all of the following aspects.

  • Deposit: as foreign buyers typically need pay half of their property purchase, it’s important to establish the amount you can put down as a deposit on your bond.
  • Bond amount: Establish the amount of the monthly repayment you can afford. You can do this by totaling your monthly income (joint income if you are married) less your expenses. The banks will normally grant a maximum bond where the repayment is no more than 25 percent of your gross monthly salary which should not be more than the amount you calculated above, otherwise you may be overcommitted.
  • Transfer cost: Do not forget to include the costs of transfer duty tax and conveyancing fees that are normally payable by the buyer.
  • Bond approval: Not only has banking changed dramatically in past years, the new credit act has made it more difficult to get bonds approved, so get good advice and assistance with regard to home loans and bond finance.

One way to avoid paying transfer duties and conveyancing fees is to buy a property off-plan from a developer. Developers normally waive the legal costs, and if the property is new and has not been previously registered, there won’t be transfer duties to pay.

Before paying duties, it’s worthwhile noting that some bond originators and finance houses may pay some of these fees for you if you register your bond with them.