Reinventing suburbia

Looking for a place to buy as a first time buyer? Experts say that some of the new buying hot spots are in areas you would not really have thought of buying in before, but you might be surprised and even find a real gem.

The 'new suburbs' are old suburbs made new and areas which were never considered before but have now seen burgeoning growth.

These areas are growing at a rapid pace, and some are being reinvented. And in time to come they are bound to see even more growth — presenting a good possibility of capital return in the near future.

Barak Geffen of Sotheby's International Realty says: "Many first time buyers have scurried out of the CBD and seaboard areas which have become exorbitantly priced and, as a result, suburbs that may have been viewed as ‘iffy’ in the past are being rejuvenated by new development."

Unveiling the curtain

Cape Town's Northern Suburbs may seem like a long shot... but they are now in huge demand and the area has become highly appealling because it's very centrally located and offers leafy areas with spacious homes and gardens.

"In places like Parow and Goodwood much development has taken place, allowing buyers to enter the market for as little as R395 000," says Geffen.

"The exceptional value for money is keeping the market afloat, increasing demand and bringing fresh new elements into these areas."

'Ready for a renaissance'

Andre de Villiers of Chas Everitt's Southern Suburbs in the Western Cape says Maitland, Southfield, Ottery and Clovelly are areas that have been overlooked.

He predicts that prices in Maitland will escalate fast in years to come. "Its central position is now starting to attract younger buyers looking for value," notes De Villiers.

"It is showing all the signs of an area getting ready for a renaissance and offers great value, diversity and development potential. All it needs is developers with vision — one landmark development is all it will take to galvanise the local property market."

Looking for a gem?

Southfield and Ottery also deserve a closer look from investors. De Villiers says that a recent survey showed that the ratio of rental return to capital outlay in these areas was the most profitable in the south peninsula.

Meanwhile, in the False Bay area of the Western Cape, a "little property gem gone unnoticed, is Clovelly for those looking for a good buy with plenty of room for capital growth".

"False Bay is now getting better rentals than even a year ago. There is a decent selection of properties with good sea views at prices from R1.6-million upwards — but they won't be available at those prices a year from now."

Give me the green

In KwaZulu-Natal, many people have chosen to move out of the central city areas into the leafy suburbs surrounding the key metropole.

"A major driver of this trend has been the desire to avoid overflowing beaches and high activity city areas and a preference for a more countrified lifestyle," says Barak Geffen.

"There has been a huge increase in development in areas like Kloof where many families chose to live in order to be close to private schools like St Mary’s, Highbury and Kearsney, along with attractive golf courses and equestrian facilities.

"Properties are large and there are a number of developments offering secure living options.

"As Durban’s metropole areas expand we are likely to see more movement inland," says Geffen.

Bound for returns

The demand pressure from emerging middle-class buyers moving into the suburbs is an added sustaining factor for houses at the middle- to lower-end of the market, resulting in "sustained price growth of between 18 percent and 25 percent (depending on area) in the R500 000 to R900 000 price segments throughout suburbs in the greater Joburg area", says Geffen.

In the Gauteng area, "Pretoria’s New East, incorporating Fairy Glen and Moreleta Park, has a large amount of new developments which has created an entry-level market where homes are being snatched up by Black Diamonds, moving into what were traditionally white Afrikaans suburbs," says Geffen.

"The Centurion area, a bridge between Midrand and Pretoria, has also taken off due to its close proximity to both metropoles and good amenities. Entry-level homes in these areas can still be found for between R500 000 and R700 000."

Hidden spots of gold

Johan Killian, who operates the Lew Geffen Sotheby's International Realty franchise on the West Rand of Johannesburg, says the area is becoming popular as investors who work in Joburg’s metropole areas take up flexi-time arrangements and install broadband, allowing them to avoid peak hour traffic and enjoy the "countrified" benefits of the West Rand.

Formerly a gold mining community, Daggafontein in Springs, and the adjacent Struisbult, are old mining communities which, because they are older and well established, have the appeal of huge trees and foliage, providing a pleasant and leafy environment for home buyers.

"The residential property market in Springs is active with a high demand for homes. Existing homes are selling from approximately R400 000 for a two-bedroom home, up to around R1-million for a spacious, four bedroom family home on a large stand. PGP's average selling price in Springs is in the region of R500 000," says Killian.

Time to move back?

Solid old homes in inner suburbs are also winning favour again among buyers, especially with young families, and this is very evident in the older suburbs of Germiston.

Leslie de Wet, co-owner of the Chas Everitt International office in Germiston, reports brisk sales in the inner suburbs.

"We find that especially couples in their mid-thirties are targeting these older homes. Their children are starting school, they need the space these old properties offer, and they prefer the established infrastructure and want to be close to amenities such as schools.

"Younger people are still keen on new developments on the outer edges of town and older people tend to buy into security villages.

"But buyers with young families find good value in the older suburbs and are not averse to buying a basic golden oldie at a reasonable price and then renovating it to suit their family's requirements," notes De Wet.

He says the lovely finishes in many of these homes are also an attraction. And although stock is limited, older homes needing a touch of renovation are still available in the R500 000 to R750 000 price range.

"Meanwhile, homes in suburbs such as Leondale are very popular among the upcoming middle class and a selection is available at prices of between R500 000 and R650 000.

"Other popular suburbs include Elspark, where prices for standard family homes range between R650 000 and R950 000, and Hazeldean, where prices range between R750 000 and R1.1-million."

Article by: Thamar Houliston - www.iafrica.com