Trade between China and Africa reached a record 1.41 trillion yuan in the first half of 2026

The rate of housing price growth in South Africa is declining as increased borrowing costs put pressure on housing demand. The market continues to be supported by supply constraints, which help stabilize prices.

Housing Market Status

The slowdown in price growth reflects a more complex operating environment for households. Market activity is expected to remain subdued for the rest of the year. According to FNB senior economist Siphamandla Mkhwanazi, high borrowing costs, weakening consumer confidence, and softer economic conditions are negatively impacting housing demand and are likely to limit market activity until the end of the year.

According to the FNB Housing Price Index (HPI), housing price growth slowed in June, falling to 5.2% year-on-year (y/y) compared to 5.7% y/y in May. Mkhwanazi also noted that recent data shows the average housing price growth in Q2 2026 was 5.6% y/y, lower than the 6.0% recorded in Q1.

Inflation and Rental Market

Although housing price inflation remains slightly above overall consumer inflation, which was 5.0% y/y in June, the gap between them has narrowed significantly compared to the beginning of the year. Latest data shows that rent increased by 4.1% y/y in June and continues to rise gradually with regional variations.

New residential construction activity remains low, and the supply of existing homes available for sale has also decreased. However, the economist emphasized that the housing market continues to benefit from supply constraints, which helps curb price increases. He added that limited stock availability prevents a more noticeable correction in housing prices and should continue to support forecasts in the near term. Therefore, while weaker macroeconomic conditions may dampen transactional activity, a broad fall in housing prices is not anticipated.

Rent and Purchasing Power

From a rental market perspective, vacancy rates continue to decline due to purchasing power constraints in the ownership market and stable household formation. Mkhwanazi predicts that housing price growth will continue to moderate down to 4% by the end of the year, as high borrowing costs, low confidence, and slowing economic growth weigh on demand.

Nevertheless, he believes that the reduction in new housing construction and the smaller number of available homes should continue to support prices. He also mentioned that the South African Reserve Bank's (SARB) decision to keep interest rates unchanged was a positive surprise for households and potential buyers. In the future, inflationary pressure is expected to peak in early 2027, giving SARB the opportunity to resume its easing cycle. Lower borrowing costs should support mortgage demand, improve affordability, and help stabilize market activity.

Rental Sector Outlook

Rental market conditions should also remain relatively stable, according to Mkhwanazi. He added that pressure on purchasing power and tighter lending conditions should continue to support rental demand, while limited development plans restrict the growth of rental stock. Nevertheless, vacancy rates remain slightly above pre-pandemic levels, indicating that excess capacity has not been fully absorbed, limiting rent growth before purchasing power becomes the constraining factor.

Expert Opinion on Rates

Last week, Keegan Stein, founder of South Africa Forbes Global Properties, called the SARB's decision to maintain interest rates at 7% a favorable outcome. He noted that this gives buyers time to absorb the May increase without further changes to what they can afford, given that confidence this year was insufficient.

In his view, at the top end of the market, rate decisions influence sentiment more than purchasing power, as their buyers typically have no encumbrances or only small debt. Stability reduces decision-making volatility.

Availability Constraints

Forbes Global Properties also pointed out that in mortgage-financed segments, purchasing power remains the main limiting factor, and banks maintain discipline, meaning volumes require time to react. The drivers differ in the luxury segment: demand is driven by scarcity. There is a finite number of properties on the Atlantic coast with the desired location and views, for which international and local high-net-worth buyers compete, and rate changes do not increase this supply. Similar dynamics are observed in the Winelands and private Big Five reserves in KwaZulu-Natal, where only a small number of villas exist within one reserve, and new ones cannot be built. Buyers in these markets acquire scarcity, not square meters. The company also noted that South Africa continues to attract lifestyle relocations and international buyers for whom the country's pricing still appears attractive compared to equivalent global markets.

Mamdani advocates for the implementation of 30% discounts on meat and fresh produce in New York City. It is foreseen that five stores will be established in each of the city's five boroughs, with the opening of the first expected by the end of 2027 in the Bronx, despite the criticism he has received.

Municipal Plan and Objectives

Mamdani estimates that all five stores will be operational before the end of his four-year term. During a press conference held in a warehouse in Brooklyn, Mamdani, a Democrat, emphasized that 'a 30% discount represents real savings for New Yorkers.'

The municipality has begun the process of selecting private operators responsible for the daily management of these stores. Authorities informed that the municipality will provide the commercial spaces, assuming the costs of rent and property taxes.

Political Context and Reactions

This proposal is part of a broader accessibility platform advocated by Mamdani, which focuses on transferring governmental power to policies that support the city's working class, who face economic difficulties. Although he initially presented the idea as a modest initiative last year, the plan generated dissatisfaction among some small merchants and local grocery store owners, who are concerned about competition from the reduced prices offered by the city-managed stores.

In response to concerns, Mamdani clarified that the municipal stores will not sell hot food or items such as beer or cigarettes, thus aiming not to harm the profitable businesses of private stores. He emphasized: 'We are not looking to compete with grocers or supermarkets in terms of their ability to survive. What we are looking to do is offer guaranteed affordable prices to New Yorkers.'

Oversight Analysis

Andrew Rein, president of the Citizens Budget Commission, an oversight body, requested a more detailed public evaluation of the program's costs, its effect on unsubsidized supermarkets, and asked for an investigation into how the city can address the fundamental causes of rising food prices. In a statement, Rein observed: 'It is difficult to understand how subsidizing supermarkets --- and the food for everyone who buys there --- is the most cost-effective way to increase accessibility or reduce food insecurity for struggling New Yorkers.'

The U.S. Department of the Treasury announced a change in financial regulations, stipulating that the Financial Crimes Enforcement Network (FinCEN) will not apply coercive measures against financial institutions offering authorized services in Venezuela.

Objective of the Measure

This determination is valid while Venezuela remains under sanctions, extending until January 29, 2027. The initiative seeks to simplify the processing of transactions conducted by American banks and other financial entities involved in humanitarian assistance, reconstruction efforts, and economic recovery in the country following recent earthquakes.

By reducing the risk of regulatory penalties resulting from potential compliance issues during these permitted transactions, the measure aims to facilitate the flow of necessary aid.

Requirements and Restrictions

The Treasury clarified that despite the easing, financial institutions remain obligated to maintain their anti-money laundering programs and comply with all existing sanctions imposed by the Office of Foreign Assets Control (OFAC).

Additionally, the statement emphasized that this protection does not apply to any intentional or deliberate violations of U.S. financial regulations.

Impact of the Earthquakes

A World Bank report issued on Thursday indicated that the damage caused by the seismic events in Venezuela, which occurred on June 24, has an estimated cost of $19.6 billion (equivalent to €17.2 billion at the current exchange rate). It is estimated that these events could compromise the country's economic recovery for a period of ten years.

Details of the Earthquakes and Sanctions

The tremors on June 24 registered magnitudes of 7.2 and 7.5 on the Richter scale, occurring with only a 39-second interval. These are considered among the most severe disasters in recent Venezuelan history, resulting in an official toll of at least 5,546 deaths and 16,740 injuries.

The United States began imposing targeted sanctions on Venezuelan authorities in 2015, during the Obama administration. Economic actions against the government of Nicolás Maduro were expanded starting in 2017 and reinforced in 2019 with broader restrictions on the Venezuelan economy, including the state oil company PDVSA.

Since then, the U.S. Department of the Treasury has granted specific licenses and exemptions to enable certain operations, including those related to the oil sector, especially after the political changes in Venezuela following the detention of Maduro by the United States on January 3.