Coastal property hotspots: Where South Africans are investing in 2025

While national property growth remains mixed, coastal towns are outperforming the rest of the country. Semigration, remote work, and retirement migration continue to drive strong demand for homes near the ocean, keeping coastal markets buoyant even as inland areas slow.

Quay 1 International Realty notes that Cape Town remains at the forefront of South Africa’s coastal investment market in 2025, driven by ongoing semigration, limited supply, and strong lifestyle demand. The Atlantic Seaboard, Southern Suburbs, and emerging areas such as Bloubergstrand and Milnerton are showing notable price resilience, with buyers from Gauteng and KwaZulu-Natal keeping demand high.

The agency also highlights that sectional title prices in Cape Town’s coastal suburbs have risen by over 35% since 2020, while freestanding homes in high-demand areas like Sea Point, Green Point, and Noordhoek continue to achieve record sales.

According to Antonie Goosen, principal and founder of Meridian Realty, the trend is structural, not seasonal. “South Africans want lifestyle security. The coast offers cleaner governance, better infrastructure and a higher quality of life. These are long-term fundamentals that investors can trust.” Goosen adds that coastal property remains one of the most resilient asset classes in South Africa, with consistent demand in key Western Cape and Garden Route towns, and renewed interest in select KwaZulu-Natal and Eastern Cape areas.

Where the smart money is going

Somerset West and Strand (Helderberg) offer a mix of family living and investment potential, benefiting from Cape Town proximity, solid infrastructure, and rental demand from both professionals and retirees. Hermanus and Gansbaai (Overstrand) continue to see value growth as roads and amenities improve. Mossel Bay and Dana Bay remain popular due to strong municipal management, with Dana Bay offering panoramic ocean views at lower entry prices. Plettenberg Bay and Knysna continue to command premium prices, though sectional title apartments and smaller homes are gaining popularity for their rental potential and ease of management, says says Goosen.

In the Eastern Cape, he adds that Jeffreys Bay and St Francis Bay are emerging as viable full-time residential areas, with improved roads and digital connectivity supporting property growth.

Short-term letting plays a significant role in driving demand, particularly in Cape Town, where tourism recovery and year-round visitor traffic have strengthened rental yields. Areas such as Sea Point, Green Point, De Waterkant, and Blouberg are seeing strong occupancy levels and attractive nightly rates, making them top performers for investors focused on Airbnb and executive rentals, notes Quay 1 International Realty.

Trends shaping the 2025 coastal market

• Remote work: The ability to work from anywhere is turning holiday towns into permanent communities.
• Early retirement migration: Buyers in their fifties are purchasing coastal homes now and renting them out until they relocate.
• Energy and water resilience: Solar installations, inverters, and water tanks are increasingly essential to protect lifestyle and resale value.
• Sectional title growth: Compact lock-up-and-go properties are performing strongly, offering rental flexibility and lower maintenance costs.

“Buyers are prioritising convenience and sustainability,” says Goosen. “They want homes that are secure, energy efficient, and adaptable for either personal use or income generation.”

Balancing affordability and growth

While the Western Cape continues to dominate in governance and long-term returns, opportunities still exist in less-tapped coastal markets. “There are towns where you can still buy below R2 million and see meaningful capital growth,” Goosen notes. Average rental yields range from around six percent in prime Western Cape areas to over ten percent in emerging Eastern Cape and KwaZulu-Natal markets. The expansion of short-term letting platforms has created new income streams for investors in smaller towns.

A Pragmatic Investor Playbook

• Choose municipalities with proven governance and reliable service delivery.
• Prioritise locations with access, amenities, and healthcare over pure scenery.
• Look for properties that can serve dual purposes as rentals and future residences.
• Invest in sustainability features that cut running costs and boost resale appeal.
• Follow infrastructure development - new roads, fibre, and hospitals signal future growth.

The Enduring Appeal of the Ocean

Coastal property remains the emotional and financial heart of South African real estate. “People will always be drawn to the coast,” Goosen concludes. “In uncertain times, lifestyle and liveability drive decisions, and those factors will keep well-chosen coastal investments performing well into the future.”

Beyond Cape Town, regional coastal markets are following their trajectory as lifestyle-driven investment deepens. Towns like Yzerfontein, Langebaan, and Hermanus on the West Coast and Overberg continue to see double-digit growth, supported by buyers seeking value beyond the metro while retaining accessibility to Cape Town. Similarly, the Garden Route, particularly George and Herolds Bay, has seen average property prices nearly double over the past five years. In KwaZulu-Natal, despite broader market challenges, the North Coast (Ballito, Salt Rock, and Sheffield) remains resilient with strong semigration inflows and short-term rental yields outperforming national averages, says Quay 1 International Realty.

"Collectively, these trends highlight a broader coastal renaissance, anchored by Cape Town’s stability and extending into adjacent coastal corridors where affordability and lifestyle converge."