When the 2023 Rugby World Cup came to an end, it wasn’t just the final whistle making waves, the game's impact stretched beyond the field and into our property market. With the game done and dusted, real estate professionals are split on what this means for real estate. Some are optimistic, believing hosting games will give local economies a boost, while others are playing it cool, warning against getting too carried away. Here’s a look through the mixed bag of opinions in the real estate world and how the Rugby World Cup has become a hot topic not just for sports fans but also for those tuned into the property market.
Unpacking the poll results
In September 2023, Prop Data polled property practitioners to find out if they think the 2023 Rugby World Cup will boost the local property market. The results found:
38% say it will.
38% say it won't.
24% say it is possible.
Commenting on the results, Angus Khan, Director at Cornerstone Management, says, “The results were certainly divided at the time of the survey. At that stage, we were not certain if there would be a win. The last three weeks of October tested our hearts as a nation and boy were there close calls.”
Speaking optimistically, Khan believes that this sense of pride and positivity South Africans have displayed can definitely impact property investment and factor into buying decisions. “Our diverse Springbok team has given hope that we as a nation can work together. It allows outside investors to see the real people and not be divided by political views. There is hope and a future in this nation with investment opportunities.”
Attracting foreign interest
International events possess the magic to turn heads and capture global attention, sparking heightened interest in our country. Whether it's a major sports championship or cultural extravaganza, these gatherings can act as magnets, drawing in foreign eyes and often kindling curiosity that can evolve into lasting economic and cultural connections.
“TV and marketing on a global scale allows international viewers, as well as influencers on online social media platforms, to see the sporting spectacle. The intensity of an 80-minute game produces excitement,” says Khan. “It is interesting to note that other sports stars like Roger Federer, whose mom is South African, and movie star Jason Mamoa appeared at the 2023 final to support their respective teams or countries. This not only gives exposure but creates intrigue and interest in South Africa. Winning the 2019 World Cup in Japan gave exposure to the Asian markets before the pandemic.”
Boosting local businesses
The Rugby World Cup, with its massive fan base, could potentially inject strength into local businesses, amplifying demand for commercial properties. From bustling restaurants to souvenir shops, the surge in visitors creates a ripple effect, prompting a need for additional commercial spaces. These events become a motivation for economic vitality and commercial real estate growth.
“Over the years, Cape Town has maintained its image as one of the top 10 cities to visit internationally and the prestige of a Rugby World Cup win may add to that positive image. Property values have tripled since 2021. Commercial companies have started moving their businesses to the Western Cape due to functioning municipalities as well as a more relaxed environment for their employees. Service delivery is essential when having commercial or private property,” says Khan.
Does victory mean impact?
As the Springboks brought home the win, many speculated whether the victory would result in a good economic impact. When it comes to the property market, 38% of practitioners aren’t convinced that the Springbok’s victory will bring any substantial impact.
According to Angus Khan, “We currently face an economic crisis that may be on the mind of these practitioners. High interest rates, unemployment, and crime seriously need to be addressed. Illegal mining, illegal immigration as well as the current government that is running on autopilot compounded by corruption in the system are having an impact. Loadshedding frustrates businesses and private persons' daily lives. There are regular reports of collapsing roads and disintegrating infrastructure. There's no accountability. If these issues are not dealt with, we will have no future investment from the international community and South Africa's GDP will be stunted for years to come. Gauteng has shown a 10% drop in property prices. It has become a buyer's market but that is a façade of the real impact.”
Final thoughts
“The Springboks have shown us that there is always hope. We did not play the most perfect game of rugby against the French and English, but we showed our resourcefulness and we were scrappers of the rugby ball. There were some truly heart-stopping moments. Against the All Blacks, the Springboks played with resolve to do it for the country. An awesome humble captain Siya Kolisi showed leadership on the field. Coach Jacque Nienabar with director of rugby, the man who gets in his opponent's heads and plays games with opponents, Rassie Erasmus, gave us a team that defended their title back-to-back wins for the 2019 and 2023 Rugby World Cups. There is always hope and that can be said about our property market as well,” says Khan.