Starter home demand spurs Rustenburg developers

Developers are “back in business” in Rustenburg, working hard to meet strong demand for starter homes at prices between R299 000 and R420 000.

To do this, says Reinette Lummis, owner of the local RealNet franchise, they are buying up old homes on large stands in areas such as Rustenburg East, Midtown and Thlabane West, and then demolishing them and rezoning the land to accommodate new high density housing developments.

At the same time, she notes, the demand for rental accommodation of all sorts remains very high in Rustenburg due to the steady influx of contractors and employees at the platinum mines surrounding the Northwest town, and property investors are reaping the rewards.

Indeed, says Lummis, many investors are now buying further units to rent out, either in the new affordable developments or at property auctions, where they always hope to pick up a bargain.

Affordability remains a problem, however, for prospective buyers in the middle-income sector of the market. “Economic developments and work opportunities are also attracting a younger generation of buyers to Rustenburg who are mostly looking to purchase homes for between R600 000 and R900 000, but there is really not much available in this range. The average selling price here at the moment is around R1m.

“What is more, it is still very hard for middle-income buyers to get loans, even when they do find a property they can afford, and all the banks require buyers to have cash deposits of between 10 and 30%.”

Nevertheless, she says, RealNet Lummis Properties is doing well. “Over the past six months, local awareness of the RealNet brand has really grown and we have both rental and for-sale stock in all areas of Rustenburg, including the popular suburbs of Safari Gardens, Protea Park and Cashan.

“In addition, we are encouraged by the fact that commercial developers have committed to several big new projects here. There are new office parks going up as well as a new hyper store and a new retirement village with frail care centre. All in all, we are confident that the market is in recovery and shaping up well for the future.”

Article by: www.realnet.co.za