South Africa’s Affordable Housing

Affordable housing in is showing signs of revitalisation in South Africa, with steady demand for properties priced between R350,000 and R700,000. Standard Bank has seen a double-digit increase activity in this market over the past four years, as ongoing urbanisation creates a greater need for accessible housing in metropolitan areas.

“This segment continues to show resilience, particularly in Gauteng and the Western Cape, where demand remains strong despite economic pressures,” says Toni Anderson, Head of Standard Bank Home Services.

Who’s Buying Affordable Homes?

Households earning up to R30,000 a month are the primary buyers of affordable homes. While the uptake of sectional title homes has more than doubled in the past four years compared to the four years leading up to 2020, the majority of buyers still prefer full-title, standalone houses.

“These are likely to be in the outskirts of key metros, but strong sales suggest buyers are willing to make that trade-off for full-title homes,” adds Anderson.

Geographically, while provinces like KwaZulu-Natal and the North West have also seen rapid growth in home loan uptake for affordable housing, Gauteng leads the market. In the four years up to February 2025, Gauteng accounted for 47% of all affordable housing loans issued by Standard Bank – a pattern that persisted even before the pandemic.

However, the demand for affordable housing extends beyond traditional markets. Despite rising house prices, the Western Cape has remained active in the affordable housing market – a trend it has consistently shared with Gauteng. Over the four years leading up to February 2025, the Western Cape accounted for 18% of all affordable housing loans issued by Standard Bank, with KwaZulu-Natal following in third place at 12%.

“When you look at the Western Cape and Gauteng, you see significant private sector investment in affordable housing projects and urban development. This has spurred growth and created more opportunities for first-time home buyers who typically look at this price range,” says Anderson.

Anderson adds that the Western Cape and KwaZulu-Natal’s strong performance aligns with their status as two of the top three provinces for first-time home buyers, many of whom seek properties in the affordable price range.

A Foot in the Door

Many Standard Bank customers take out only one affordable housing loan, but a growing subset is also accessing additional funds for home improvements or expansions—indicating that these purchases serve as entry points into the housing market for buyers with bigger aspirations.

Anderson says this is why Standard Bank has developed a strong value proposition for the affordable housing market. For first-time buyers, the bank offers up to 108% bond financing to cover upfront costs such as registration and transfer fees. Additionally, it provides re-advances, making it easier for customers to obtain funds to improve or expand their homes. These re-advances are less complicated than applying for a new home loan, and funds become immediately available once the customer meets all the requirements.

“The provision and financing of affordable housing is critical in South Africa, given the shortage of housing in the country,” adds Anderson. “Our commitment remains to help more aspiring home buyers secure and improve their homes.”