Affordable Housing Plans Take Shape

With the Budget Speech postponed to early March, uncertainty lingers around fiscal policy, but industry experts remain optimistic about the market’s potential in 2025.

David Jacobs, Gauteng Regional Manager for the Rawson Property Group, sees major opportunities in the government’s talked-about plan to convert hijacked government buildings into affordable housing.

“This is a big win for the property sector,” he says. “It not only gives people the chance to live closer to where they work, but it also opens up new possibilities for developers. More construction means more jobs, which leads to more income and ultimately increases demand for property. This kind of stimulus, from the ground up, is exactly what our market needs.”

Affordability, urban renewal and market growth
One of the key challenges in South Africa’s property market has always been accessibility, particularly for first-time buyers. The proposed repurposing of government-owned buildings could change this, increasing the supply of affordable housing and making homeownership a reality for many who have previously been excluded from the market.

“This is about more than just property,” Jacobs continues. “When people move from informal settlements or overcrowded living conditions into proper homes, they start to build generational wealth. That has a ripple effect across the economy. Plus, well-located housing close to business hubs will make city centres more vibrant and support local businesses.”

At the same time, Jacobs notes that developers will need clarity on incentives and financing options.

“Government support will be key,” he explains. “If this initiative is well-structured, we could see a surge in interest from private developers and investors, which will boost both the rental and sales markets in urban areas.”

The delayed budget speech: a blessing in disguise?
While the property market is encouraged by the government’s housing initiatives, many are keeping a close eye on the postponed Budget Speech, where critical decisions on taxation and fiscal policy will be revealed. The prospect of a VAT increase has been a major concern, as it could negatively impact affordability and household budgets.
Leonard Kondowe, National Manager at Rawson Finance, believes the Budget Speech delay is a positive move.

“Rather let the powers that be discuss and be in agreement on crucial things that are going to affect the daily lives of South Africans,” he says. “A VAT hike would have a direct impact on disposable income, making it harder for people to afford homes. The fact that the Finance Minister is going back to the drawing board is a good sign that the GNU is working and officials are holding each other accountable. Hopefully, they’ll come back with a better outcome for everyone.”

Bank lending and market conditions
Kondowe emphasises that, regardless of the budget outcome, financial preparedness will be key for homeowners and buyers in 2025.

Banks remain committed to financing homeownership, and those who take the time to strengthen their financial profiles will be in the best position to secure favourable lending terms. While interest rates remain competitive, the best deals will go to buyers who demonstrate financial stability and careful planning.

To maximise their chances of approval, Kondowe encourages buyers to be proactive.
“If you’re thinking of buying in 2025, now is the time to ensure your finances are in top shape. A strong credit record, stable income, and, where possible, a deposit can all help you secure a more attractive home loan,” he says.

He also stresses the importance of ongoing financial awareness.
“We always recommend homeowners review their bonds annually. There may be opportunities to optimise costs, whether through refinancing, adjusting repayment terms, or taking advantage of potential rate shifts,” he explains.

By taking control of their finances, buyers can enter the market with confidence, knowing they’ve positioned themselves for the best possible outcome in 2025.

What lies ahead?
Despite some uncertainty around government policy, the outlook for South Africa’s property market remains positive. With plans to boost affordable housing, stimulate urban renewal, and potentially avoid a VAT increase, there are clear signs of progress.

“If these policies are implemented effectively, we could be looking at the start of a real turnaround,” Jacobs says. “More jobs mean more disposable income, which leads to higher demand for property. It’s a cycle that, if nurtured correctly, can drive long-term growth in our sector.”

For now, buyers, sellers, and investors should stay informed, prepare for possible fiscal shifts, and take advantage of opportunities as they arise. If the momentum from SONA carries through, 2025 could mark the beginning of a stronger, more dynamic property market in South Africa.

At the Rawson Property Group, we’re committed to helping South Africans navigate the property market with confidence. Whether you’re looking to buy, sell or rent our team is here to provide expert guidance.