The latest Lightstone property report came out recently, detailing property price inflation across South Africa.
The chart below comes from this report, and shows property price inflation by province for 2025:
Chart: Lightstone Property Price Inflation 2025
Surprisingly, the province with the highest price inflation was Limpopo — my assumption is that this comes off a very low base.
Next was the Western Cape at 5.67%. Given I sold a flat in Johannesburg at a loss after holding it for seven years, I’d be quite happy with a one-year return like that.
Gauteng, on the other hand, came in at just 2.17% — well below inflation.
Below is a table showing inflation across value bands, regions, and provinces over the past four years:
Table: Lightstone Property Price Inflation
The Western Cape has clearly delivered the best returns over the past five years. Let’s assume you earned 5.5% p.a. in capital appreciation there. If you also managed to rent the property out successfully and generated a 5% net yield, you’d be sitting with a 10.5% annual total return.
Not bad at all.
Of course, that return came with a fair amount of work: managing tenants, handling maintenance, and facing rates and taxes that likely increased more than 10% a year. That extra admin and cost is harder to quantify.
Still, if you owned in the Western Cape and managed all that well, 10% per year would feel like a solid win.
Personally, though, I’d never go back to property. I live in the world of markets — of owning businesses through a stock exchange. I can buy into companies all over the world. The big difference is that it’s passive — I don’t run the businesses I invest in. They have very well-paid CEOs doing that.
When we look at the 5-year returns of both the JSE All Share Index and the MSCI World Index, the annualised return has been around 15% per year.
Table: JSE All Share Index & MSCI World index 5 years returns
That’s 50% higher than even the best-case return on property.
At 15% per year over five years, your portfolio would have doubled. And apart from logging into your Allan Gray portal — which you probably shouldn’t do too often — there’s been very little work.
The key, of course, is having a financial plan and an intentional asset allocation. Unlike property, it’s easy to make mistakes with your portfolio — it’s too easy to get scared and sell out at the wrong time.
But when approached correctly, the stock market is more powerful, lower maintenance, and has delivered better returns.
