URERU Seminar 1 2025: Unpacking 2025: Western Cape Property Market Trends

Unpacking 2025: Western Cape Property Market Trends

The URERU (Urban Real Estate Research Unit) Seminar, hosted at the University of Cape Town, kicked off its 2025 series with an engaging discussion on property finance, development, and market trends in the Western Cape. The event brought together key stakeholders, students, and industry professionals, fostering a collaborative space for dialogue and insight-sharing and was hosted by Prof Francois Viruly.

The introduction set a reflective tone, acknowledging the growth of these seminars from just 10 attendees in the early years to over 200 responses today. The host emphasized the unpredictability of global events, referencing Nassim Taleb’s Black Swan theory, and drew parallels between past economic disruptions and current trends in AI and PropTech.

A central theme was the nexus between commercial and residential property markets, and between the public and private sectors. The discussion highlighted Cape Town’s record-low vacancy rates, a shift toward a more integrated real estate ecosystem, and the increasing role of technology in property transactions. The introduction also touched on policy changes, such as the Expropriation Bill and Human Settlements White Paper, and their potential impact on the sector.

The panel featured three distinguished experts from diverse sectors:

1. Erica Naude – An urban planning professional with over 30 years of experience, currently serving as the Director of Urban Planning and Design at the City of Cape Town. Her work has been instrumental in municipal by-laws, ESG policies, and small-scale developer programs.
2. Gavin Wiseman – A specialist in affordable and social housing, currently Director of Affordable Housing within the Western Cape Department of Infrastructure. With over 25 years in housing development, he has extensive experience navigating government policy and human settlements strategies.
3. Quintin Rossi – CEO of Spear REIT, a Western Cape-focused property fund that has grown significantly from R354 million to R5.4 billion in market capitalization. His insights focused on investment trends, regional property performance, and the impact of semigration and infrastructure development.

The Q&A session provided valuable insights into the future of property development and investment. Below are some of the standout discussions:

1. What Are the Biggest Challenges in Cape Town’s Property Market?

• Erica Naude emphasized the strain of rapid population growth, particularly in the affordable housing sector. The city is pushing for private sector involvement, as government-led initiatives alone cannot meet demand. Strategies like zoning incentives, infrastructure investment, and streamlined development approvals are being explored.

2. Is the Cape Town Market Reaching a ‘Golden Age’ of Property?

• Quintin Rossi noted that Cape Town’s record-low office vacancy rates (as low as 2% in prime locations) indicate strong market fundamentals. The province is seeing increased investment, particularly in the logistics, retail, and residential sectors, driven by policy stability and infrastructure availability.

3. What Role Does Infrastructure Play in Supporting Growth?

• Gavin Wiseman highlighted the importance of bulk infrastructure investments to support increased densification. The city is aggressively upgrading water, sanitation, and transport networks, but challenges remain in aligning zoning approvals with service delivery.

4. How Is the Western Cape Balancing Public and Private Housing Development?

• The shift from fully government-subsidized housing to public-private partnerships was a key topic. Weisman revealed that social housing projects worth over R4 billion are currently stalled due to funding constraints. Alternative financing models, including leveraging pension funds and institutional investors, are being considered to bridge the gap.

5. Are Smaller Towns in the Western Cape Becoming New Investment Hubs?

• Rossi pointed to the rise of smaller towns like Malmesbury, Stellenbosch, and George as emerging property hotspots. With remote work driving decentralization, areas outside Cape Town are becoming increasingly attractive for residential and commercial development.

6. How Will Transport and Connectivity Affect Future Growth?

• The province’s transport infrastructure was a recurring concern. Some attendees questioned whether Cape Town is isolating itself from the rest of the country. The panel acknowledged the need for improved national connectivity but noted that provincial and municipal budgets limit large-scale transport investments.

Closing Thoughts

The session underscored the dynamic evolution of the Western Cape property market, with a focus on economic resilience, policy shifts, and investment opportunities. The discussion highlighted both the challenges and opportunities of a fast-growing market, particularly in balancing housing affordability, infrastructure expansion, and investment potential.

As Cape Town continues to cement itself as South Africa’s premier investment destination, collaboration between government, private developers, and financial institutions will be crucial in shaping a sustainable and inclusive property landscape.