Cape Town’s investment community is missing a massive opportunity by overlooking its townships. The valuation gap between urban areas and townships highlights deep inequality in income, wealth, and quality of life.
Soweto has over 1,600 properties worth more than R1 million. In the last year alone, property transactions there exceeded R1.1 billion, with a growing share driven by first-time buyers under 35. By contrast, Khayelitsha has zero properties valued at R1 million or more. The majority of homes are worth between R200,000 and R400,000, with the average transaction sitting at just R336,000. Household incomes mirror this gap: in Soweto, more than 20% of households earn above R13,000 a month, while in Khayelitsha almost 60% earn below R6,500.
Tourism tells a similar story. Soweto has been positioned as an international heritage destination, attracting hundreds of thousands of visitors annually to Vilakazi Street and other landmarks. Khayelitsha with it’s own rich history, and despite being the second largest township in South Africa and less than 40 minutes from booming Cape Town’s CBD, receives only a fraction of the city’s 2.6 million foreign tourists each year. Most visitors are unaware that nearly half of Cape Town’s population is Black African, predominantly Xhosa-speaking, or that the Khoi and San have a deep, underrepresented history here.
Investment currency follows perception. While Soweto has drawn both property investment and small-business development, Cape Town’s townships remain under-invested. Crime, unemployment, and lack of infrastructure deter capital, creating a cycle of exclusion.
Solutions are within reach:
• Position townships like Khayelitsha as cultural and heritage tourism hubs, similar to Soweto.
• Invest in digital infrastructure and entrepreneurship to capture part of the R200 billion township e-commerce economy.
• Create blended finance vehicles to de-risk private investment in township property and retail developments.
• Support local leadership and middle-class growth to anchor accountability and sustained development.
Cape Town is marketed globally as one of the world’s most beautiful cities. For that story to be complete and inclusive, its townships must become part of the vision, not footnotes in the margins.
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