4 July 2019

South Africa: The Return of Joburg's Legendary Hillbrow

analysis

Property developers are returning to Hillbrow, which was SA's cosmopolitan and leafy piece of real estate during the 70s and 80s. Developers are building new flats in the inner-city suburb for the first time since the 1980s. This is a big deal.

SA's housing market has always mirrored the state of the economy.

House prices and sales have slumped countrywide, except in parts of the Western Cape, since the 2009 recession, which coincided with the start of Jacob Zuma's presidency and years of economic and moral decline.

To be specific, homeowners have battled to achieve inflation-beating price growth on their properties every year over the past nine years -- rendering property investment a dud. However, Hillbrow in Johannesburg has bucked the trend.

Hillbrow-based residential properties, mainly high-rise apartments, recorded cumulative price growth of 51.5% in nominal terms (before adjusting for inflation) over the past 10 years (2008 to 2018), according to data from analytics firm Lightstone. The suburb has pipped the national house price growth of about 30% over the same period.

Property developers believe the strong capital appreciation in Hillbrow's property market will drive the demand for apartments among buyers. This has prompted property developers to erect construction cranes...

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