FROM TENANT TO HOMEOWNER: WHY NOW’S THE TIME TO BUY IN JOHANNESBURG

After nearly two decades in the real estate business, Jonathan Kohler, Founder and CEO of Landsdowne Property Group, one of the country’s largest residential real estate agency and managers – has finally done something surprising: he bought a home to live in.

For years, Kohler, like many South Africans, debated whether buying was better than renting. He knew the pros and cons of both, but the timing never felt quite right. That changed recently, when he decided to plant roots in Johannesburg – a city he believes has hit the bottom of its property cycle, making it one of the best times to buy.

Why now?

“Prices in Johannesburg are more accessible than other metros,” Kohler explains. “With freehold homes especially, there’s real value if you’re looking to settle down. Many buyers are shifting to secure estates, which opens opportunities in suburbs that are still central but less competitive.”

Kohler isn’t just speaking from industry insight – this time, it’s personal. “Buying a home is more than an investment on paper. It’s about creating a haven, a place that’s yours, where you can make memories and truly feel at home. With Johannesburg offering solid value and interest rates on the decline, now may just be the right moment to make your move,” he says.

Buying to live vs buying to invest

The first question any buyer should ask themselves is simple: Am I buying this home to live in, or to rent out as an investment? The answer will shape every part of the decision from location to loan type.
Buying a home to live in comes with unique rewards:

• Emotional value: It’s your space, your rules. Renovate, redecorate and settle in without a landlord’s permission.
• Equity and appreciation: Over time, the home’s value increases and every bond repayment builds equity.
• Stability: Owning your space brings long-term peace of mind – no leases to renew or landlords to negotiate with.
• Tax benefits: Depending on your financing, interest and property taxes may be deductible.

That said, it’s not without its hurdles. There are steep upfront costs (like deposits, transfer duties and legal fees), plus ongoing maintenance. If interest rates increase, so too can your monthly repayments.

Yet with interest rates recently dropping, affordability is improving. Kohler believes this is opening the door for more buyers, especially first-timers to enter the market confidently.

The investment case

On the flip side, buying property as an investment is more practical. The goal is rental income and long-term growth. “A good investment property in a high-demand area can generate steady returns,” Kohler says.

Advantages include:

• Monthly rental income: If managed well, the rent can cover the bond and other expenses.
• Inflation protection: Property tends to keep pace with inflation, maintaining your capital’s value.
• Tax relief: Rental expenses and interest can be deducted from taxable income.
• Capital growth: Over time, well-located properties tend to appreciate.

But it’s not a passive investment. Landlords need to budget for maintenance, deal with tenants, and prepare for vacancies. “The trick is buying in a price bracket where your shortfall is minimal,” Kohler advises.

So, which one to choose?

There’s no universal answer. Buying to live in is often a lifestyle choice – one tied to emotional goals, stability and future security. Buying to invest is a business decision, requiring discipline, research and a tolerance for risk.

For Kohler, buying his own home came down to timing and confidence in the Johannesburg market. “After years of renting, it was time. The market made sense, and it felt right for my family.”

And perhaps that’s the real takeaway. Whether you’re buying for yourself or your portfolio, know why you’re buying. When choosing a home for yourself, lifestyle factors such as proximity to schools, work and public transport often play a bigger role than potential returns.

When it comes to investing in physical property, Kohler still sees a strong case provided it’s done correctly. “Buy in the right area, with strong rental demand. Put down a meaningful deposit. Get involved by attending complex AGMs, interrogate the financials and keep an eye on maintenance. A hands-on approach can protect and even enhance your investment.”

Alternative property investment options

While physical property offers tangible advantages particularly when you buy right, investors also have access to a wider range of real estate investment options.

More South Africans are exploring indirect property investments through Exchange Traded Funds (ETFs) designed for real estate investors who rely on regular income with dividend payouts every three months.

In March, Reitway Global expanded its ETF offering with the introduction of the Reitway Global Property Income Prescient ETF – the company’s first income-focused ETF, and 10th property-focused tracker fund now available on the JSE, including both local and global options.

“These investment vehicles give investors exposure to international property markets, dollar-based returns and regular income without the complexities of managing tenants or properties,” says Kohler.

Unlike physical property, which can take months to buy or sell, these funds offer greater liquidity. Investors can buy in or cash out relatively quickly and the entry point is often lower, with no transfer duties or legal fees.

However, as with most investments you hand over control. “You cannot renovate or reposition the asset and your returns are ultimately linked to how well the fund is managed and the performance of global property markets.”

As with any investment, Kohler advises doing thorough research before committing. Whether buying to live in or as an investment, it’s essential to understand the property, all associated costs including maintenance or management fees and the expected returns.