The Q3 2024 Absa Homeowner Sentiment Index (HSI) reflects continued optimism in South Africa’s residential property market, with 84% of respondents expressing confidence in its future. This sentiment remains steady from the previous quarter, supported by two recent interest rate cuts, signalling recovery after a challenging hiking cycle.

While lower interest rates are expected to provide tangible relief in coming months, financial recovery for many remains gradual. House price indices, such as the Absa House Price Index, indicate nominal improvements over the past year, reinforcing cautious optimism for market recovery.

Key sentiment metrics improved in Q3. The sentiment to buy increased by 6 percentage points (pp) year-on-year to 73%, reflecting growing interest in property ownership, particularly among first-time buyers. Buy-vs-rent confidence rose by 2pp from the previous quarter to 83%, while investment sentiment held steady at 80%, up 3% from Q3 2023. Sentiment to sell also rose modestly by 2pp to 48%, with sellers anticipating better prices. Renovation sentiment, while slightly down from Q2, has trended upward since early 2023.

Inland regions outperformed coastal areas in confidence metrics, while short-term rentals emerged as a popular secondary income strategy. First-time buyers, forming the majority of home loan applicants, displayed stronger optimism than repeat buyers, underlining the importance of financial guidance for this group.

Now in its tenth year, the Absa HSI continues to provide valuable insights into consumer confidence, property trends, and the evolving dynamics of South Africa’s real estate market.