KATHU, Northern Cape — A small town in the Northern Cape is unofficially challenging Sandton’s reputation as the country’s wealthiest square mile, as Kathu emerges as South Africa’s richest town amid a massive mining boom. Known as the “town under the trees,” the region is experiencing unprecedented economic growth fueled by rich deposits of manganese, iron ore, and zinc. These critical minerals are increasingly in demand worldwide for building modern infrastructure, Artificial Intelligence (AI) data centres, and Electric Vehicles (EVs).
The scale of the operation is significant, with approximately 25 major mines operating within a 100-kilometer radius of Kathu. This concentrated industrial activity is attracting high-earning specialized engineers, technical operators, and artisans to the area. As a result, the average annual salary index for the Gamagara Local Municipality has been lifted to well beyond half a million rand per year, surpassing even that of Johannesburg.
Maree Ras, a representative from REMAX Kathu, noted that while it remains a small town, its economic footprint is substantial. She explained that the major mines generate significant national turnover and require highly qualified professionals. To attract top-tier talent to a remote location, competitive income remains the most effective incentive, requiring companies to pay a premium for relocation.
However, this influx of high earners is dramatically reshaping the local real estate landscape, driving up property prices and leaving first-time homebuyers as the hardest hit demographic.
Tiaan Pretorius, an ERA Manager, explained that the local property market is overwhelmingly driven by the mining sector. He highlighted that more than 85% of property sales are directly linked to mining activities, with rental demand being even higher. This intense competition for housing subsequently inflates overall property sales prices across the town.
The rapid inflation has created distinct challenges for non-mining residents. Fhulufhedzani Thupe from Phedzani Properties pointed out that the mining boom is making life difficult for locals, as landlords and property owners often operate under the assumption that everyone in Kathu and the nearby town of Kuruman works in the mining sector and possesses high disposable income.
Despite the current prosperity, there are growing concerns about the town’s long-term economic sustainability. With the average operational lifespan of these mines estimated at around 20 years, residents and local stakeholders fear that a future scale-down in mining activity could devastate the local economy. Consequently, there is a strong, urgent push for the town to diversify its economic base before the current mining boom inevitably slows.
