New buyers and investors have grown new interest in the booming township markets.
Image: Simphiwe Mbokazi
Soweto, Cosmo City, and Alexandra Townships are among the townships in Johannesburg that have shown a significant growth in the economy.
Once banished and marginalized communities, these areas are now attracting considerable attention from both residents and investors, witnessing a dynamic change in the nation’s property market.
IOL spoke to Lohlohonolo Setati, a real estate agent in Cosmo City and Alexandra.
“The shift is significant, particularly for businesspeople who want to venture into Kasi business,” he said.
Data reveals a compelling upward trend in township property values. Notably, FNB data from 2013 to 2018 highlighted a remarkable 52% increase in Soweto house prices.
This surge reflects a growing demand and confidence in township living.
First National Bank showing data of house sales in Soweto and significant growth of 52%, marking the highest increase in the Johannesburg area compared to regions such as Sandton and Midrand.
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The ongoing trends have indicated that township property is a good investment.
According to recent data from Lightstone and BetterBond, a large portion of affordable housing market activity is located in the townships.
Investors and first-time buyers between the ages of 30 and 39 are looking at township homes before considering the likes of Midrand, Fourways, and Sandton due to the easy access and lower cost of living.
Mpho Ndou, a 31-year-old from Cosmo City, has been running his secondhand shop for five years.
“People in the community are constantly looking for ways to cut costs, either from traveling to buy food or any items,” he stated.
Forecasts suggest that by 2028, the global second-hand market could reach approximately R6.38 trillion.
Due to their recognition of the potential township markets, major retail players like Boxer and Shoprite have been drawn to the growing economy.
Vusi Thembekwayo examined Shoprite's 2024 fiscal year calendar in his TikTok video, revealing that the company had increased its sales to R250 billion in 2024 and opened 3,639 stores in townships throughout South Africa.
Shoprite’s Sixty60 delivery service has also been introduced to Jabulani, Soweto, which underscores this trend.
A resident of Jabulani Soweto, Sellina Makamu, said, “Even though I haven’t seen the scooters, I believe it is a good idea to limit long queues and also save a lot of time traveling.”
Nevertheless, the townships faced a dire emergency as overpopulation and strain on infrastructure remain a significant concern.
Going in and out of the townships has been a nightmare for motorists, with traffic lights becoming a street pole for advertisements. Stable electricity and running water are becoming indistinct to the locals and also booming business.
IOL