Farm price frenzy

This post discusses the general farm price fluctuations as noted by Eric Rosenthal in his 1959 book, Other Men's Millions. The various booms and slumps are quite complex and varied from area to area. It is not a comprehensive analysis, but merely a discussion of Chapter 22 - Farm price frenzy.

Map of the Cape fof Good Hope by Johannes Nieuhof (1672-82) 

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Contextual timeline

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Jan van Riebeeck sells Boschheuvel - 1665 (high prices)

Shortly after Jan van Riebeeck departed from the Cape, public notices were posted on November 24, 1665, at the Fort, in the town, and across the countryside. These announcements stated that the agents acting for the former Commander planned to sell his land - located below Boschheuvel - to the highest bidder on the following Saturday. The auction would be held in the large hall of the Fort.

Van Riebeeck's property consisted of 101 morgen of cultivated land, complete with a barn (schuur), and is widely believed to have encompassed the area that later became the estate known as Westbrook (today associated with Bishopscourt / Protea.)

Four days afterward, on November 28 at precisely noon - just as auctions are timed today - the lands belonging to the "departed Commander Van Riebeeck" were put up for public auction. The sale proceeded "met beckenslagh uytgeveijlt," meaning it was announced and conducted with the traditional beating of a gong, a custom that persists in similar form even now.

The property was purchased by Jacob van Roosendaal (also recorded as Jacob van Rosendael), who served as a foreman and agriculturalist. Historical records confirm that this Boschheuvel estate, originally granted on loan to Van Riebeeck in 1658, passed into freehold ownership under Van Roosendaal in 1665.

During Jan van Riebeeck’s time at the Cape (1652-1662), land within the settlement’s tightly restricted boundaries was surprisingly expensive and highly sought after. The Dutch East India Company (VOC) established the Cape solely as a small refreshment station, confining European activity to a limited area around Table Bay, the fertile Liesbeek River valley, and a few nearby pockets of arable land - totaling just a few hundred square kilometers at most. Natural barriers and strict VOC policies prevented widespread expansion: land was granted sparingly to a small number of trusted free burghers, usually in modest freehold plots of 15-20 morgen, with strict conditions tying produce to the Company. This created acute artificial scarcity in the few safe, watered, and officially approved farming zones suitable for growing wheat, vegetables, and vines to supply passing ships.

WA van der Stel sells Vergelegen - 1709 (high prices)

Vergelegen map from the book Contra-Deductie (1712)

Another impressive sum was achieved when Vergelegen, the grand estate established by Willem Adriaan van der Stel, was sold in November 1709 to Barend Gildenhuys (also recorded as Berend Gildenhuys or Barend Gildenhuis) for £9,000.

Following Willem Adriaan van der Stel's dismissal and recall by the Dutch East India Company (VOC), the property - confiscated due to allegations of abuse of power and private profiteering - was subdivided into four separate portions and auctioned off. The core section containing the homestead and main buildings, which retained the name Vergelegen, fetched this substantial price, reflecting the estate's extensive vineyards, orchards, buildings, and prestige as one of the Cape's most developed farms at the time. The sale marked the end of direct VOC governance involvement in such large private holdings at the Cape.

1713 Plague (low prices)

In 1752, due to a sharp decline in property values stemming from the lingering effects of the devastating 1713 smallpox epidemic (often referred to at the time as "the plague"), which caused widespread and ongoing mortality among residents - within weeks the Company slaves were succumbing at the rate of about eight persons a day to the disease - the Orphan Masters (Weesmeesters) sought to facilitate sales of estates under their administration. To make properties more attractive to buyers amid the depressed market, they relaxed the usual requirements: the traditional need for two financially secure sureties (guarantors) was eliminated and replaced with a mortgage secured directly on the property being sold. This made it easier to sell land quickly, easing financial pressure on estates amid the economic downturn and high mortality. For much of the Dutch period, land speculation in the Cape Colony remained constrained by the restrictive terms under which land was granted to settlers.

The Orphan Masters' primary role was to administer and safeguard the estates of deceased persons under specific circumstances, ensuring minors or absent heirs were not defrauded or left destitute.

The standard arrangement was the quitrent system, where farmers paid a modest annual fee to the government (the Dutch East India Company, or VOC). The VOC retained ultimate ownership of the land, and - in theory, at least - could reclaim it after proper notice. This changed after the British took control of the Cape (permanently from 1806 onward). They introduced the perpetual quitrent system: once the (still modest) quitrent was paid, the farmer effectively became the outright owner in practical terms, granting far greater security of tenure.

Given the vast, sparsely populated expanses of land across the colony, it is perhaps unsurprising that land generally remained inexpensive. Yet, in certain desirable areas - particularly as settlement intensified in the Western Province - prices could soar dramatically. Farms near Cape Town, especially in fertile and scenic districts like the Constantia Valley, Paarl, Stellenbosch, and Franschhoek, occasionally fetched thousands of pounds, reflecting high demand in these premium locations despite the broader abundance of available land.

Smallpox was foreign to the Khoikhoi. Hence they had no recourse to indigenous medicines that could be used for this disease. So the Khoi fled the Peninsula with all their belongings in the hope of escaping the smallpox. Settler farmers moved into areas previously inhabited by the Khoi and started a new existence for themselves with the aid of the Cape government.

The Great trek - 1835-40 (Low prices)

A genuine crisis in land values erupted in 1835 with the onset of the Great Trek, as thousands of Boer farmers abandoned their properties in the eastern districts of the Cape Colony and headed inland in search of independence from British rule and new grazing lands.

Hundreds of farms flooded the market, triggering a severe slump clearly evident in the advertisement sections of the Government Gazette and contemporary newspapers. While Cape Town and the established wine-producing regions remained relatively stable and unaffected, the impact was catastrophic for frontier districts such as Somerset East, Graaff-Reinet, Grahamstown, Cradock, Middelburg, and similar areas. The mass exodus devastated local economies reliant on these settler farms.

Large tracts of land fell into the hands of speculators, who often held them for just a few years before reselling at a profit. For example, on September 15, 1843, a Cape Town merchant advertised a single consolidated holding of 77,000 acres in the Nieuwveld district for sale - an enormous block assembled from distressed or abandoned properties.

Merino Sheep farming - 1840s (high prices)

Those who acquired such expansive holdings in the aftermath soon reaped substantial rewards during the wool boom of the 1840s and beyond. The rise of merino sheep farming transformed the Cape's pastoral economy, with wool exports surging and driving land values upward again in suitable grazing regions, turning earlier speculative purchases into highly profitable investments.

The wool boom in the 1840s (primarily in the Cape Colony) lead to the rapid expansion and profitability of the wool industry during that decade, which helped drive up land prices in certain areas, where speculators resold large blocks of land acquired cheaply during the Great Trek slump and profited from the wool surge. The boom was caused by the introduction of Merino sheep and a strong demand for wool by British textile mills. It created demand for land in suitable grazing areas, allowing speculators to resell vast holdings at higher prices a few years after the 1835 slump.

Natal Sugar Plantations - 1850s (high prices)

Even when adjusting for differences in purchasing power and economic conditions of the era, land prices in the newly settled territory of Natal could reach surprisingly substantial levels.

In November 1849, a land agent named D. L. Binneman in Pietermaritzburg advertised farms for sale at prices ranging from £300 to £600 - sums that contemporaries considered exorbitant, especially given the frontier nature of the region and the relatively recent British annexation (1843) and influx of settlers (notably via schemes like Byrne's 1849–1851 immigration program, which offered land allotments at much lower effective rates).

Byrne's 1849–1851 immigration program was a private, commercial initiative to bring British settlers to the Colony of Natal during a period when the region needed population growth to develop agriculture, infrastructure, and British influence after its annexation in 1843. The scheme was designed to attract working-class and skilled emigrants (especially from Britain) by offering affordable passage combined with land grants.

A notable benchmark for Natal occurred in 1856, when the estate of Edward Moreland (also spelled Morland), one of the colony's pioneering sugar planters, comprising 1,306 acres, sold for 15 shillings (15/-) per acre. Local newspapers hailed the transaction as a clear indicator that "Natal land is going up," signaling rising confidence in the region's agricultural potential—particularly for sugar cultivation along the coast—and an emerging upward trend in rural property values amid growing settlement and economic development.

Orange Freestate + the Railways - 1850s (high prices)

Railway map (1882) - Source: UCT Library.

In the 1850s, land values in the Orange Free State experienced a significant boom, particularly in the lead-up to - and immediately following - the British withdrawal from the Orange River Sovereignty and the formal establishment of the independent Orange Free State Republic via the Bloemfontein Convention in February 1854.

Just before this transition, a farm in the Winburg district sold for £2,400, while another property near Bloemfontein had an offer of £2,000 firmly rejected. To appreciate the scale of these figures, early settlers often regarded £50 in cash as a sufficient annual income to support a family - making such sales prices astonishing to contemporaries and underscoring the rapid escalation in perceived land worth as political stability and settlement prospects improved under Boer self-rule.

A further surge in values occurred toward the end of the decade, spurred by the initial construction of railways in the Cape Colony (beginning in 1859 with the first lines, though progress accelerated later). Even the anticipation of rail access ically boosted prices by promising improved transport, market access, and economic integration. As far north as Colesberg (a key frontier town on trade routes toward the interior), land values rose by nearly 50 per cent in response to these developments, reflecting how infrastructure expectations began reshaping rural economies across the region.

Railways dramatically improved accessibility and economic viability boosted agricultural productivity, attracted investment and settlers, and increased demand for land in connected or nearby areas, driving up farm and land values.

Slump of the 1860s (mixed)

The 1860s brought a pronounced slump in land values across much of the Cape Colony, as economic pressures - including a collapse in wool prices early in the decade, lingering effects from earlier migrations, and broader agricultural challenges - depressed rural property markets.

The wool boom encouraged massive expansion of merino sheep flocks across the Cape (and competing colonies like Australia and New Zealand). By the 1860s, global supply had outstripped demand, leading to a glut on the London market.

A stark illustration came on June 11, 1861, when the vast farm "Nooitgedacht" in the Victoria West district, spanning 35,000 acres, sold for a mere 5 pence per acre - reflecting rock-bottom prices in the arid interior regions hit hardest by the downturn.

Amid this widespread depression, the Oudtshoorn district stood out as a notable exception. Its agricultural potential had been greatly enhanced by the adoption of irrigation, which supported more intensive farming (and would soon fuel the emerging ostrich-feather industry). Even in 1862, a small parcel - just one thirty-second of a larger farm - commanded a record price of £900, demonstrating localized resilience and demand for irrigated, fertile land.

Irrigation transformed Oudtshoorn from a marginal grazing area into a productive agricultural hub, sustaining the ostrich industry (and later alternatives like lucerne/ostrich combos or other crops). The region's water challenges fostered innovation - many of South Africa's early irrigation experts originated here. This enhanced fertility driving up land prices in the 1860s amid broader slumps. The adoption was pragmatic and farmer-led at first, accelerated by economic incentives (ostrich feathers funding infrastructure), and later supported by state projects for stability in a water-scarce region.

In contrast, the story in Stellenbosch was far gloomier. A property that had fetched £120 per year in rent (or equivalent value) just two years earlier plummeted to only £40 by 1862, underscoring the broader decline in established wine and mixed-farming districts during these difficult years.

On August 9, 1866, the Graaff-Reinet Advertiser ran a strikingly pessimistic editorial on the depressed state of farm values. The paper observed: "This fall in the value of farms is nothing more than a return of things to a state that should have continued, one that gave the farmer a reasonable profit on his labour and capital."

In the village of Maclear, town erven were disposed of for as little as 2 shillings and 6 pence each. In the Transvaal, land values remained absurdly low as well. A notable anecdote from 1857 recounts how a Mrs. Nortje approached President M. W. Pretorius to complain that her former husband, prior to their divorce, had sold the farm legally belonging to her for just half an aum of brandy (an aum being a traditional measure roughly equivalent to about 150-155 liters).

Shortly after the 1860 unification of the small Republic of Lydenburg with the South African Republic (ZAR), no fewer than 73 farms changed hands for a total of 17,257 rixdollars (with a rixdollar valued at approximately 1 shilling and 3 pence, or 1/3d.), amounting to barely £1,000 in total - or an average of roughly £13-14 per farm (though some estimates round it to around £3 per farm in contemporary terms, highlighting the extreme undervaluation).

When Lydenburg unified with the ZAR, the region remained sparsely populated, economically underdeveloped, and affected by wars/native tensions - factors that kept prices depressed until later booms (diamonds, gold).

Yet, as Professor A. M. Pelzer of the University of Pretoria emphasized: Living costs remained very low, many burghers held money out on mortgage loans, and a significant portion of the population enjoyed relatively comfortable circumstances despite the nominal cheapness of land.

Diamonds and ostrich feathers - 1870s (high prices)

The discovery of diamonds in the Cape Colony - beginning with alluvial finds along the Orange and Vaal rivers in the late 1860s, followed by the major Kimberley rush from 1870 onward - triggered an extraordinary surge in land values.

This boom was further amplified by the rapid expansion of the ostrich feather industry, particularly in regions like the Little Karoo, where domesticated ostrich farming became highly profitable in the 1870s, driving demand for suitable grazing and enclosure land.

The ostrich feather boom was a significant economic phenomenon centered primarily in the Little Karoo region around Oudtshoorn. It occurred in two main waves, driven by global fashion trends and agricultural innovations. The first boom ran from approximately 1865 to 1880 - by the 1850s–1860s, farmers in arid areas like Oudtshoorn began domesticating wild ostriches, a breakthrough that allowed for controlled breeding and plucking. During the 1880s-90s a market lull occurred due to overproduction and fashion shifts. The second and more intense boom lasted from about 1900 to 1914 when SA dominated global supply. This period transformed Oudtshoorn into the "Feather Capital of the World," with feathers becoming one of the country's top exports, sometimes rivaling gold in value per weight. WWI disrupted trade routes and there was a shift in women's fashions - the rise of automobiles made large feathered hats impractical.

One of the era's largest land deals occurred in 1870, when the Orange Free State government sold several hundred farms in the so-called "Conquered Territory" - a disputed border area recently seized from the Basotho people during the Basotho Wars and incorporated into the republic's eastern frontier. These extensive holdings realized a total of £107,780, reflecting the heightened speculative interest and rising confidence in interior pastoral lands amid the broader mineral and agricultural upswing.

In 1875, John Noble, Clerk to the old Cape House of Assembly, commented on the dramatic progress in the Karoo region. Describing properties around Cradock, he noted: "These properties generally command very high prices: from £5,000 to £7,000 for a farm varying from 3,000 morgen upwards is not uncommon, and there are many old-established estates which could not be purchased for double these sums." Such figures highlighted the transformation of what had once been marginal sheep-farming country into valuable assets, fueled by improved infrastructure, export markets, and the spillover effects of diamond wealth.

Prominent landowners in the district included J. Trollope, John Collet, and members of the Michau family. The Trollopes held vast properties totaling between 25,000 and 27,000 morgen, while Mr. Collet ran a flock of no fewer than 10,000 sheep - all of superior, high-quality stock -illustrating the scale and prosperity achieved by leading farmers during this prosperous phase.

Native wars - 1870s (low prices)

A major land transaction unfolded following the death of the prominent Alexander McCorkindale (1816 Scotland - c1872 Mozambique) - though some contemporary accounts place related estate matters and sales in the mid-1870s). McCorkindale, a Scottish hunter, entrepreneur and founder of the ambitious New Scotland settlement in the eastern Transvaal (today's Mpumalanga region, around modern Ermelo), had acquired extensive holdings in the Lydenburg district during the 1860s through negotiations with Transvaal authorities. 

His estate included 42 farms, each measuring approximately 6,000 acres (a substantial size typical of Transvaal grants), totaling well over 250,000 acres - some estimate 500,000 acres. Despite this vast portfolio, land prices remained depressed - largely due to ongoing native wars (including conflicts with the Pedi under Sekhukhune and border tensions), political instability in the young republic, McCorkindale's own insolvency at death (from malaria on Inhaca Island), and the slow realization of his grand settlement vision.

The term "native wars" refers to conflicts between European settlers/Boer republics and indigenous African groups during the 19th century (e.g., Basuto Wars, Frontier Wars, Zulu-related conflicts). These wars had a dual and often contradictory effect on land prices: they typically depressed values during active hostilities due to uncertainty, risk, and economic disruption, but boosted them post-victory through the confiscation and sale of indigenous lands, opening new areas for speculation and settlement.

A few months after these events (around 1876), when the Transvaal government offered erven (town plots) for sale in Pretoria, they attracted only modest bids of about £30 each - a reflection of the broader economic malaise and low confidence in urban and rural property values at the time, before the later mineral booms revived the region. This contrasted sharply with the speculative highs seen elsewhere in South Africa during the diamond era, highlighting how frontier insecurities continued to suppress prices in the Transvaal even as other areas surged.

One of the most striking examples of bargain-basement land deals occurred at a Lydenburg auction on May 4, 1886. Following the death of a certain Mr. Wimble, his estate - including 11 farms totaling 33,000 acres - was put under the hammer. These extensive holdings sold for a mere £21 in total. Remarkably, the same properties were resold shortly afterward for £3,000, illustrating the opportunistic profits available to alert speculators in the volatile Transvaal market of the time.

Near Bloemfontein, another notable transaction saw the farm "Tempe" - spanning 4,200 morgen (roughly 8,400 acres) - fetch £5,400. This sale reflected the growing appeal of well-located properties close to the Orange Free State capital, even amid broader fluctuations in rural land prices during the late 19th century.

In the newly established town of Upington, a sale of crown land in morgen parcels took place around the same period. Prices averaged 2 shillings per morgen, while another 22,000 morgen fetched only 1 shilling each. Despite these low rates, 20 farms remained unsold, underscoring persistent market weakness in the arid northern Cape frontier.

Rinderpest - 1896 (low prices)

Shot cattle being buried (1897). Source:The National Library of South Africa

Political instability, combined with the outbreak of the most severe cattle plague ever to strike South Africa - the devastating rinderpest epizootic of 1896-1897 (which decimated herds across the region, crippling transport, agriculture, and rural economies) - quickly precipitated another sharp downturn in land values. In September 1897, in the Wodehouse division of the Cape Colony, the farm "Valschfontein" - comprising 18,000 morgen of prime grazing land - attracted no bids at all, a stark indicator of the economic paralysis caused by the disease and associated uncertainties.

Turn of the century - 1900 (high prices)

By the turn of the century, however, property values began a steady recovery. A telling example comes from Upington: one buyer who acquired three morgen for £375 in 1887 rejected an offer of £1,800 for the holding - demonstrating how productive irrigated or riverine land in the region had appreciated significantly in value amid improving agricultural returns and growing settler confidence before the conflict erupted.

Natives Land Act - 1913 (mixed)

While not specifically mentioned in this chapter, 1913 is historically notable for the Natives Land Act (passed June 19, 1913), which restricted black South Africans to owning just 7% of the land, leading to widespread dispossession, evictions, and long-term economic inequality. It responded to pressures from white farmers, particularly in the Transvaal and Orange Free State, who sought to limit black competition in agriculture.

This Act exacerbated poverty in black communities and altered land markets by consolidating white ownership, but it didn't cause an immediate general slump in white-owned property values - rather, it created structural distortions that depressed rural economies over time. The act later formalized dispossession, restricting black ownership and inflating white-held land values. Property in black townships were undervalued due to insecurity.

Ostrich feather crash - 1913 (low prices)

This Oudtshoorn region had seen land prices skyrocket due to the prosperity of the ostrich feather industry. However, the slump flooded the market with properties as banks foreclosed on mortgages, forcing many farms into distress sales. Those who retained their holdings eventually recovered, but the event highlighted the risks of speculative booms tied to single commodities. This property crash was a direct consequence of the ostrich feather market's collapse, which began in 1913 and intensified into 1914.

"As with every other branch of investment great fortunes have been made and lost by investment in South African land. Even Oudtshoorn district, where the fantastically high figure of £1,200 an acre had been reached, saw a slump in 1913 which brought practically the whole area into the market through the banks that had taken over the mortgages. Those that were able to hang on came out safely. Nothing is new in speculation." (Rosenthal, 1959).

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Sources

• Rosenthal, E. 1959. Other Men's Millions. pp 198-204.