While the property market is off on a steady start for this year, there have been a few recent developments for property owners, investors, and landlords to take note of.
Property and Budget 2026 – tax relief, infrastructure investment, interest rates
Budget 2026 introduced a more upbeat economic outlook for the year with lower inflation and interest rates compared to prior years. The budget prioritised municipal reforms, and tax relief for households (including potential property buyers) and small businesses.
While the transfer duty exemption threshold remains unchanged at R1.21 million, sellers received a significant boost with the primary residence Capital Gains Tax (CGT) exclusion increased to R3 million (from R2 million), allowing owners to retain more of their profit. Infrastructure investment for struggling metros to deal with service issue, will also be a positive for property values, and ease the upward pressure on utility costs.
The finance minister also formally announced the new lower inflation target of 3% aimed at bringing the interest rate down over the long-term. Additionally, the minister confirmed that the Reserve Bank proposes scrapping the prime interest rate and replacing it with the SARB Policy Rate (Repo Rate) as the single benchmark for lending.
Is Your Property Correctly Valued by the City of Cape Town?
Property owners and landlords are reminded to ensure the proposed new property valuations issued by the City of Cape Town is correct as these will impact the new rates set to take effect from July 2026. Objections must be lodged by the 30th of April.
If you have not already done so, please feel free to contact your local Seeff area specialist who can quickly assist with an assessment of your value compared to current market trends.
New Regulations for Short-Term and Airbnb Rentals
Short-term and Airbnb rental investments are also facing new regulatory shifts which will be of interest to property owners, landlords and potential rental investors. The first is the City of Cape Town’s proposed 2026 Short-Term Letting By-law which will effectively result in those operating primarily as businesses having to pay commercial property rates which could mean a cost increase of up to 135%. It is currently in the draft stage.
The Department of Tourism has also gazetted an STR Draft Code (Code of Good Practice for Short-Term Rentals) on the 13th of March 2026. This interim framework requires hosts to act in good faith by informing guests of municipal bylaws and body corporate rules regarding noise or parking, and includes certain compliance issues while also mandating that online platforms to provide guest identity data to hosts to enhance security. This may also potentially involve added administration and costs.
Property Market Performance and Emerging Risks
The broader property market is currently in a positive recovery phase, particularly in Cape Town with house prices still on a positive growth trajectory. That said, we are seeing emerging risks from the Middle East War and higher oil prices putting interest rates under pressure which could impact demand in the market.
For now though, the market continues to benefit from a lower interest rate compared to last year, and the Southern Suburbs and Constantiaberg especially is facing a stock crunch, providing an ideal window of opportunity for sellers to take advantage of the favourable selling conditions.
Propstats data shows that properties across the areas are now selling twice as fast as last year, dropping to an average of just 22 (45 days in higher price brackets) with many selling within a day to a week. Sellers are also achieving closer to, and often their full asking price, especially in the high demand areas.
Southern Suburbs/Constantiaberg Market is Favourable for Sellers
Given that there is currently a favourable market across the Southern Suburbs/Constantiaberg aeras, we would urge those looking to sell to not delay, especially in view of the uncertainty introduced by the US policies.
Contact your local Seeff area specialist now for a no-obligation assessment of what your property might sell for in the current market, or if you would like to discuss opportunities in the market.