FEMSIE FERREIRA, Cape Town | Wednesday
HOUSES nestling between Table Mountain and the sea have been snapped up since the fall of apartheid by foreigners after a place in the sun, but this summer dealers say sales doubled as South Africa’s currency plummeted.
The influx has roused mixed feelings from locals. The ruling African National Congress (ANC) is wondering whether to impose curbs on foreign ownership of property while locals complain that it has pushed prices beyond their reach.
“More and more people from Europe have been buying homes here in the past six years, but this has been a particularly good summer,” said Peter Gillmore, the regional director of Remax Properties Southern Africa.
“We’ve seen a significant increase of sales to overseas buyers over three months as a result of the fall of the rand.”
Cape Town’s shore is reminiscent of the Riviera, but infinitely cheaper after the rand lost some 40% in value and comfortingly far away from the threat of terrorism and the war on it in the northern hemisphere, he says.
“Spain and the south of France is no longer comparable from a value point of view and since September 11, South Africa has come to be seen as a safe haven. A year ago people were worried about crime here but now everything has become relative.”
Andrew Golding, the director of Pam Golding Properties, said the company’s sales to foreigners grew to R75-million in December — with the average buyer spending about one million rand ($86 100 dollars / 99 900 euros) — and predicted they would increase further over the January-April peak season and in years to come.
“It has been extraordinary this December. We have had double our turnover. We would normally sell 10% of our property to foreigners but in December it came to 18%,” he said.
“We are seeing the tip of the iceberg. What we have to offer people from Europe is going to eclipse Spain and France.”
A two-bedroom apartment on the Costa del Sol would cost twice as much as one in Cape Town while a big house there or in St Tropez might cost several times the three million rand they sell for here.
Typical buyers, Golding says, are most likely British or German, middle-aged and looking for a second home where they can spend a few months a year or eventually retire.
John Parriman, a retired English investment banker, bought a four-bedroom house in Claremont south of Cape Town where he and his wife plan to spend half the year to escape the worst of London weather.
“We love the place and when the rand dropped very substantially to sterling it tipped the balance in favour of buying,” he said.
“It’s extremely beautiful, it’s a similar lifestyle, language is no problem and we drive on the left side of the road like back home. It is not quite like being on holiday; we go out and feel like part of the community.”
In the recent rush properties have sold to young professionals flush with foreign currency and holidaymakers have “impulsively” bought mansions while taking a Sunday drive, Golding says.
Golf estates, dotted around the Cape peninsula and the south coast, have been hugely popular, like small farms and wine estates.
In the past year four vineyards in the Franschhoek region outside Cape Town were sold to French nationals, three to a Congolese telecommunications magnate and three to an Italian.
ANC leaders were prompted to say in January they were worried that the “jewels of the land” were being sold to foreigners and called for a debate on whether to impose conditions, such as forcing buyers to apply for citizenship.
Party representative Smuts Ngonyama backtracked last week, saying: “There is no need to panic. We must give the foreigners security. We simply don’t want people saying we did not look at this.”
Some of those who have bought here have been angered by the party’s statements as they feel they have brought foreign investment and created employment.
Rui Fernandes, an administrator for the British owners of Chamonix wine estate in Franschhoek, said foreigners not only bought property in post-apartheid South Africa because it was cheap but because they believed in the country’s future.
“They feel there is stability in the country. These people do not bring in that amount of money to lose it. And they have lots of friends who come here and spend.” – AFP