Joburg homeowners rent out rather than sell as Cape Town semigration shifts
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Stronger rental demand and lagging Gauteng house-price growth are pushing more Johannesburg owners to let their homes instead of selling when they move to Cape Town, though agents warn net returns are thinner than headline rents suggest.
A growing number of Johannesburg homeowners who can afford to do so are choosing not to sell when they relocate to Cape Town, renting out their Gauteng homes while they rent in the Western Cape, according to Grant Smee, chief executive of Only Realty Group.
“Selling your Johannesburg home was once the natural first step when relocating to the Cape, but that calculation has changed,” Smee said. “If you own a good property but the current market isn't giving you the price you want, renting it out allows you to generate income while waiting for conditions to improve.”
The strategy rests on a widening gap between the two markets. Recent Rode Report data puts average yields on A-grade apartment blocks at about 8.1 percent in Johannesburg against 7.3 percent in Cape Town, while Stats SA figures showed Johannesburg house prices rising by around 4 percent year on year in early 2026 as Cape Town recorded substantially stronger growth.
Rental demand for larger family homes is also being supported by constrained stock. Financial Mail reported that across nine sought-after Johannesburg suburbs, the number of houses advertised for sale fell from 127 in December 2025 to 68 by July 2026, even as prices failed to respond as basic supply-and-demand logic would suggest.
The income matters because Cape Town living is expensive: Smee said the average monthly rent for a two-bedroom apartment in the CBD is approaching R33,500, roughly double what it cost six years ago, with family homes in the City Bowl, Southern Suburbs and Atlantic Seaboard commanding considerably more.
He cautioned that owners should not decide on headline rental figures alone, since letting and management fees, municipal rates, levies, insurance, repairs, maintenance and vacancies all erode returns, and managing a property from another province adds complexity. He recommended weighing the net income against the alternative of selling, releasing the equity and applying the capital to Cape Town housing costs.