Personal tax relief is designed to prevent individuals from paying higher taxes solely due to inflation-linked salary increases. This measure can enhance bond affordability and assist in covering escalating monthly expenses, such as rates, levies and maintenance costs.
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Although property takes longer than shares to react to the budget speech, improved sentiment allows confidence to filter through.
Finance Minister Enoch Godongwana delivered the 2026 Budget Speech on Wednesday, February 25, where he announced reforms in local government, including shifting to a performance-linked utility model for water and electricity services.
He said this is aimed at strengthening financial sustainability, accountability and transparency. “Spatial and housing reforms focus on restructuring our cities to ensure that people have access to affordable housing located close to centres of economic activity.”
In that environment, banks often become more willing to lend, and buyers become more willing to transact, says Eva August, CEO at Century 21.
“The good news is there is no major new tax shock. This is a better confidence for the property. It is helpful for buyers as inflation tax relief supports affordability at the margins.”
She says that something to watch out for is that fuel increases can push up building and living costs.
The real estate company says the government says it wants to stop debt from running away and bring spending under better control.
It says that while that sounds boring, it matters because:
Treasury said debt should peak and then start improving, which is a confidence signal, says August.
The business says highlights include:
1) No big new tax hit as National Treasury said it pulled back on a previously planned R20bn tax increase.
“For households, this matters because big new taxes make people nervous - and when people are nervous, they delay property decisions.”
2) Personal tax relief, making a little more money, stays in the consumer's pocket. The government adjusted income tax brackets and rebates for inflation.
“In plain language: this helps stop you from paying more tax just because your salary went up with inflation. This can help with bond affordability and can help cover rising monthly costs like rates, levies, and maintenance.”
3) The government is encouraging savings (good for deposits). This supports a culture of saving. For property, savings matter because deposits matter. Stronger deposits usually mean better bond approvals and healthier lending.
4) The VAT registration threshold went up (from R1m to R2.3m). Century 21 says that it mainly affects smaller businesses, and property depends on many of them: Contractors, plumbers, electricians, painters, cleaners, photographers, signage teams, gardeners-the people who keep homes market-ready and buildings maintained.
Less admin pressure can help these businesses survive and grow.”
As expected, Budget 2026 recognises the country’s improving economic outlook, with several reforms and strategic interventions beginning to deliver measurable results.
However, the Finance Minister emphasised the need for continued fiscal discipline and structural reform to ensure South Africa sustains this positive momentum.
Homeowners will welcome the decision to withdraw the R20 billion in tax increases provisionally included in the May 2025 Budget, says Stephan Potgieter, CEO of BetterHome Group Mortgage Origination and BetterBond.
He says this, together with the full adjustment of income tax brackets and rebates in line with inflation, will provide households with more disposable income, supporting affordability and making homeownership more attainable.
“Although an above-inflation adjustment to address the 'bracket creep' of the past two years would have been preferable, the announced adjustment is a move in the right direction.
"There was also no adjustment of the transfer threshold, which increased to R1.21 million last year. Some good news, however, is that the tax-free thresholds for various transactions have been adjusted. The threshold for paying capital gains when selling your primary home has increased from R2 million to R3 million,” Potgieter says.
The CEO says that in a local government election year where service delivery has become an increasingly important consideration in homebuying decisions, plans to strengthen municipal fiscal integrity are particularly significant.
“Many communities experience inconsistent service delivery due to financial mismanagement and capacity constraints at the local level.
"The decision to reform the Municipal Infrastructure Grant and apply performance-linked budgetary allocations will help improve accountability, reduce inefficiencies and enhance access to reliable basic services, which in turn will support buyer activity and market confidence.”
The consumer mortgage origination brand says the minister also highlighted the importance of spatial and housing reforms aimed at improving access to housing opportunities closer to centres of economic activity.
While further detail is needed on implementation, progress in this area would meaningfully support sustainable urban development and long-term housing market growth, it says.
Earlier this year, Lightstone, which specialises in property data insights, told "Independent Media Property" that “Close to jobs” is usually expensive and often scarce. Its data on stock growth shows major metros add stock, but demand concentrates faster than affordable supply in well-located nodes.
“Lightstone repeatedly observes a structural shift toward Sectional Title and Estates. In Gauteng, 5% of sales of the past three years were either within Estates or Sectional Schemes.
“This is the proximity trade: households accept smaller footprints to buy into better-located (or better-serviced) nodes.”
Overall, Potgieter says they are encouraged by the Budget’s continued focus on infrastructure investment as a catalyst for economic expansion, improved service delivery and job creation.
“These fundamentals are essential to fostering a stable economy and a resilient housing market.”
Independent Media Property