As the property market shifts, homeowners often wonder how to price their homes correctly.
Overpricing is one of the most common and costly mistakes, warns Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa. A home listed too high may sit unsold for months, eventually selling for less than expected.
“A well-priced property usually attracts strong interest in the first few weeks,” he explains. “If it lingers on the market, buyers are likely finding better value elsewhere.”
Samuel Seeff, chairman of the Seeff Property Group, notes that prices are not set by sellers but by what buyers are willing to pay. The true value of a home emerges when a willing buyer and seller agree on a price. This isn’t random: it’s shaped by the property’s features, the neighbourhood, and overall supply and demand. Sellers often attach sentimental value to their homes, but the market ultimately decides the price.
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Buyers, meanwhile, may be surprised to find wide price differences between similar homes in different areas. Property values are tracked through tools like the Residential Property Price Index (RPPI), compiled by Statistics South Africa and the South African Reserve Bank using Deeds Office data. Lightstone, banks such as FNB, and bond originators like ooba also provide indices based on their own data, offering insight into trends.
Location: The biggest driver of value
Location remains the single most important factor affecting price. A property’s worth is linked to its surroundings - views, safety, cleanliness, transport links, and access to schools, shops, and leisure amenities. A small, older home in a sought-after, well-serviced suburb can often command a higher price than a larger, newer house in a less desirable spot.
Claude McKirby, Co-Principal at Lew Geffen Sotheby’s International Realty, highlights proximity to major economic centres as another key driver. In cities such as Johannesburg, Cape Town, and Durban, homes near business hubs like Sandton, the Cape Town CBD, or Umhlanga are in high demand. Professionals value shorter commutes and reduced transport costs, which supports higher prices and continued growth.
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“Whether you’re buying a primary residence or an investment property, understanding location’s impact is vital,” McKirby advises. “Market dynamics can vary not only between cities but even between neighbouring suburbs, so research is essential for making sound decisions.”
Market conditions and sales trends
Economic factors and market sentiment also shape prices. In a seller’s market, strong demand and limited supply push prices up. In a buyer’s market, plentiful stock and weaker demand put downward pressure on values. Comparing recent sales of similar properties is one of the most reliable ways to gauge what buyers are actually paying.
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Property size, features, and condition
A home’s characteristics are another major consideration. Erf size, floor area, layout, and the number of bedrooms and bathrooms all affect value. Desirable extras like secure parking, a pool, or modern finishes can increase appeal. Well-maintained homes generally achieve higher prices than those needing repairs. Upgrades to kitchens and bathrooms can add value, but Seeff cautions against overcapitalising, as not all improvements guarantee a strong return on investment.
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