As 2005 moves well into its first quarter, the residential property market in Cape Town remains buoyant with a particularly strong demand from local buyers, according to Mick Joyce, managing director of Pam Golding Properties’ Western Cape metro region.
Joyce said that homes in the middle price range from R500Â 000 to around R2,5-million were receiving the most attention, further boosted by low interest rates, which were creating increased confidence in buying for property investment.
PGP sales in the upper end of the market remained good, with recent selling prices achieved in the Atlantic seaboard ranging from R6-million to R15-million to local buyers, and with interest in homes priced up to the R29,5-million mark.
“While it’s true to say that in general buyers, cognisant of the rapid appreciation of properties over the past few years in particular, are resistant to overpaying because the marketplace is more competitive, the demand is definitely there and buyers are purchasing at the right price,” he noted.
“The demand for gated, residential estates continues, and other, new opportunities are arising in the market through subdivisions and rezoning.
“There is more stock coming onto the market at present, and our estate agents are successfully fulfilling their obligations in ensuring expectations between sellers and buyers are met — a fact which is reflected in our extremely good sales turnover in December last year (2004) across most areas.
Sales were exceptionally good in the southern suburbs and the Atlantic seaboard — including the Waterfront, city bowl, Hout Bay, Camps Bay and Sea Point; and Langebaan up the West Coast, while the northern suburbs continue to attract significant attention with excellent sales.”
He added that while local buyers dominated the market in the Western Cape, the international outlook was also favourable.
“Our own PGP website sees a great deal of overseas investor interest — in the Cape Town area mainly in the R1-million to R3-million price range and in the city bowl and Waterfront areas. Properties over R3-million are also arousing overseas investor attention.
“In addition, interest among South Africans living abroad continues to grow rapidly, with many seeking second homes for holidays and/or investment. We also see increasing interest among parents living here looking to buy properties locally for their offspring living abroad — for use on their return after completing overseas studies or employment contracts. In this regard Cape Town’s city bowl is in high demand,” he said.
In Cape Town’s central city, PGP had sold approximately R550-million in new residential developments or redevelopments resulting from the conversion of former office buildings into quality residential apartments, such as Mutual Heights, Cartwrights Corner, The Adderley Hotel Suites, Perspectives, 34 St Georges Mall and Mandela Rhodes Place. These excluded any re-sales in the central city or city bowl areas.
Over the next three months, further new developments in the central city were due for release through PGP as well. Demand for city apartments and city living remained high, both from local and overseas purchasers, and brisk re-sales had been predominantly to residential rather than investor purchasers whose intention was to live in the city.
Construction on the redevelopment projects was moving ahead at a steady rate.
In the northern suburbs, Joyce said homes priced from R1-million to R2-million were being snapped up immediately, with those well priced up to R3-million also selling swiftly. In the Table View area, the West Coast and the Northern Peninsula were also attracting high interest among buyers.
“Given the current macroeconomic scenario, all the fundamentals remain in place for another buoyant year in the Western Cape property market. Capital appreciation of residential homes can be expected to continue, although somewhat more conservatively estimated at between 12% to 20%, depending on location, type of accommodation, and other variables,” Joyce said. – I-Net Bridge