Sunday Times - Cape Towns lucrative holiday rentals
Foreigners are once again expressing keen interest in renting property on the Atlantic Seaboard in South Africa this festive season and are prepared to pay as much as R21,000 a day for certain exceptional properties for the privilege.
As the festive season approaches, many home-owners in popular beachfront areas of Cape Town may, as a result, be contemplating whether a small fortune can be made by renting out their homes for the peak holiday season.
Pam Golding Properties (PGPs) rentals director for the Western Cape Metro region, Dexter Leite, says the holiday rental market tends to be heavily focused on the Atlantic Seaboard. He says he has noted interest from foreigners seeking rental terms of a month or two, for example in Hout Bay, where rentals vary from R1,800 to R3,000 per day in high season, and Llandudno where the figure can rise as high as R10,000 per day.
Leite adds that there has been an increase in foreign interest for the months of January, February and March, at rates of around R20,000 per month. However, he says the chief holiday rental demand is seen in Clifton, Bakoven, Bantry Bay and Camps Bay, where owners often vacate their homes for the high season so as to maximise rental returns.
"The most popular period for these rentals is from 20 December through to 6 January, when rentals of up to R4,000 per day can be achieved - although a few exceptional properties can demand as high as R21,000 per day," says Leite.
PGP says there is still a market for both buyers and renters of holiday homes. PGPs MD for the Western Cape Metro region, Mick Joyce, says Cape Towns Western Seaboard remains one of the most popular areas for buyers of holiday homes, particularly along the long stretches of beachfront which run virtually uninterrupted from the Lagoon Beach Waterfront through Dolphin Beach and Bloubergstrand, up to Melkbosstrand.
"Most of these areas offer stunning views of Table Mountain and Robben Island," says Joyce, "with easy access to the beach for leisure activities including walking, swimming, wind- and kite-surfing".
"Prices vary from enclave to enclave, but typically one can expect to pay from one million rand upwards for a one-bedroomed beachfront apartment in the Blouberg area, and up to three million for a three-bedroomed unit within walking distance of the beach. Penthouse units can fetch up to 10 million rand or more."
PGPs Blouberg area manager Madelon Venter reports that there is also considerable interest from overseas buyers, including Germans and UK residents who have purchased holiday homes in this area.
At recent beachfront developments such as Portico and Horizon Bay - which have the added bonus of attracting rental income for buy-to-let owners capitalising on the holiday home market - approximately a quarter of all units were purchased by foreign buyers via the PGP website. About half of these were expatriates, says PGP.
Venter adds that Melkbosstrand remains an extremely popular holiday home destination, but says property is scarce and sells at a premium.
The Lagoon Beach Waterfront has also reportedly seen a huge rise in demand as a holiday home destination. PGP says prices here start from around 26,000 rand/sqm. Entry-level one-bedroomed apartments in these developments start at around one million, the agents say.
PGP adds that further up the West Coast, the town of Langebaan remains popular for holiday homes, particularly those along the beachfront, with access to the lagoon. Area manager Stephanie Wynne Cole says there is a good mix of buyers who utilise these homes for their own family holidays, and those who capitalise on the buy-to-let market, where rentals of around R1,600 to R2,500 per day.
Along the South Peninsula, the market for holiday homes has quietened somewhat, according to the agents. However area manager Colleen Curtis reports that towns such as Fish Hoek, Kommetjie and Scarborough remain popular for their beaches and sea views, as well as their laid-back atmosphere.
Prices here are reported to range from around R700,000 for apartments up to around three million rand for larger homes. Cape Towns Southern Suburbs tend to appeal to resident buyers rather than out-of-town holidaymakers, says area manager Peter Ludwig. But there is a limited demand for holiday homes at the very top end of the price scale, specifically for ambassadorial-type homes with high security, says PGP.
These are used by mainly foreign owners who spend a month or two holidaying in the Mother City. For the rest of the year, the homes tend to be locked up and maintained by domestic-, garden- and security staff. The price tag on such homes varies, but can reach as much as R45 million, say the estate agents.
Article by: Evan Pickworth - www.sundaytimes.co.za