Amazing Facts About South African Real Estate
When thinking of Africa, you automatically imagine lions, elephants, zebras and other wildlife. In reality, the continent is developing rapidly and you will likely not find these wild animals parading the streets any longer. African countries are among of the quickest growing economies of 2018, with Ethiopia sitting at the number 5 position – globally.
On top of economic progress, African countries’ populations also increased drastically over the last few years, bringing in a large demand for housing and commercial space. This is behind Africa’s transformation as a global property investment hotspot.
Here are some of the lesser known facts about Africa’s booming real estate industry:
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. Two key factors behind the appeal are a growing tourist industry and favorable exchange rates. International hotel groups are relentlessly expanding their African portfolios but tourism is just one of the attractions.
Housing is often cheap.
Only a handful of Africans can afford upmarket homes. This is why luxury properties in the continent are mostly owned by foreigners. If you’re aiming for a long-term investment, affordable housing is probably risky business. Selling a single luxury villa can earn you more than several low-cost homes. For starters, you have to find a local mortgage provider for low-income households.
Even if prices went down to $10-20,000 for a simple modern unit, most Africans will still find unattainable. 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 unstoppable.
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 South Africa’s unending corruption problems have not stopped it from becoming a popular investment hub. The rand stays weak against global currencies and the cost of living is significantly low. 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. A 50% deposit is often required when you buy land. In some countries, like Mozambique, the government is the only party allowed to own land. In any case, prior to investing in Africa’s real estate industry, make sure you do you research and learn more about it.