How Trump’s Presidency could impact the local property market: A new view on global influence

• Trump’s Tweet on South Africa: Trump’s remarks on land expropriation led to a decline in the rand, influencing market sentiment and economic stability.
• Expropriation Act Safeguards: The 2024 Expropriation Act includes protections for property owners, ensuring expropriation occurs within defined public interest criteria.
• Global Impact on Property Investment: Despite domestic factors, global uncertainties, including U.S. policies, could lead high-net-worth individuals to invest in South Africa's stable real estate market.

As the world continues to navigate the political and economic ripple effects of Donald Trump’s presidency, there’s growing interest in how international policies and global events could affect markets far beyond the U.S. South Africa’s property sector, often considered a bellwether of broader economic trends, is one area that may see both direct and indirect influences from Trump’s policies and his global economic strategies.

The South African rand, often referred to as the nation’s "share price," recently took a hit following a tweet by Trump on his Truth Social platform. His remarks about South Africa’s land expropriation policies, which he accused of harming certain groups, set off a chain reaction, causing the rand to slump to R19.0342/$ in early February 2025. The tweet prompted Trump to announce a freeze on funding to South Africa, pending an investigation into the country’s actions regarding land redistribution.

Yet, within South Africa's real estate sector, there’s an ongoing debate over the potential consequences of the country’s new Expropriation Act of 2024. Samuel Seeff, chairman of Seeff Property Group, assures that the Act should not alarm homeowners, investors, or those seeking to enter the property market. While the Expropriation Act of 2024 allows for the possibility of expropriation without compensation, Seeff explains that it includes several safeguards to protect private property owners. The Act also aligns with the Constitution’s "property clause," ensuring that any expropriation must be in the public interest and follow strict consultation procedures, with courts having the final say in any disputes.

“Expropriation has been sensationalized,” Seeff notes, emphasizing that it would not affect residential properties. Unlike in Zimbabwe, where residential homes were seized, the South African legislation does not pose an immediate threat to homeownership or residential property values. Even if land is expropriated, it will be done within clearly defined public interest criteria. “The property market remains stable and there’s been a notable improvement compared to last year, with interest rate cuts boosting buyer confidence,” says Seeff, adding that inland provinces like Gauteng, which often see a high influx of first-time buyers, are set to see positive momentum.

While the U.S. policies under Trump’s presidency are unlikely to trigger immediate changes to the South African property market, regional director and CEO of RE/MAX of Southern Africa, Adrian Goslett, highlights how global political events can still play a role in shaping local trends. “While South Africa’s property market is primarily influenced by domestic factors like interest rates, inflation, and local investor sentiment, broader international developments—including U.S. policies—can’t be ignored,” he explains.

One significant factor to consider is the performance of the rand against the U.S. dollar. Under Trump’s "America First" policies, economic volatility and fluctuating currency values often caused emerging market currencies like the rand to weaken. A weaker rand tends to increase import costs, leading to inflationary pressures that could, in turn, force the South African Reserve Bank to raise interest rates. Higher interest rates can make home loans more expensive, reducing the affordability of property for many buyers and slowing overall demand.

However, Goslett points out that geopolitical uncertainty, especially under Trump’s administration, can drive high-net-worth individuals to seek stable property markets like South Africa’s. "Despite global challenges, South Africa offers attractive opportunities for foreign investors looking for value. Even in a turbulent global market, this could offset some of the negative consequences of external economic pressures," he says.

The local property market’s future remains a product of multiple factors. Though Trump’s policies may not have an immediate, direct effect on South African real estate, they will likely influence the market indirectly over time. Whether through the strength of the rand, the cost of imports, or foreign investment trends, the global economic environment will continue to shape domestic property conditions.

“Regardless of external factors, South African property remains a solid long-term investment,” concludes Goslett. "Buyers and sellers should keep their focus on personal circumstances and consult with trusted real estate professionals to navigate the evolving landscape.” Thus, while Trump’s presidency may not create major shifts overnight, the long-term implications for the local property market remain an important area of focus for homeowners, investors, and potential buyers alike.

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