KZN property 'still doing well'
| Pockets of the KwaZulu-Natal property market are still
achieving growth of between 15 and 20 percent, creating good opportunities
for investors, despite the recent hiccup in coastal sales due to the damage
done when the province experienced unusually high tides.
That's the word from Richard du Toit, owner of the Aida office in Ballito on the KZN North Coast, who says the market in the province is still playing catch-up to the rest of the country.
"The local market lags the national market by a good six to 12 months. And although we are currently experiencing a buyer's market, the province will be on a solid footing to take advantage when the next upturn comes around early next year.
"In fact, right now KZN property offers a golden opportunity: Sellers are willing to negotiate on price - in some cases discounting their property by up to 20 percent - while prices are expected to start rising faster again from January next year," he says.
Du Toit, who also owns several other Aida offices in KZN, points to Ballito as a star performer of the booming KZN market. "Prices have risen by at least 300 percent in the past five years. New residential units were brought to the market in answer to strong demand from Gauteng and other upcountry buyers and commercial development has kept pace with the residential market.
"Ballito has been transformed into a mini city and is set for further development. Several multinationals have taken commercial space in the town, while new residents are setting up shops, providing work opportunities for locals, which, in turn, further stimulates the housing market," he says.
"The greatest need currently is for units in the R500 000 to R1m price band to accommodate local blue collar workers, many of whom commute from elsewhere."
Limited stock of small inland flats is still available at around the R800 000 mark, but Du Toit says the real entry level lies around the R2,5m mark.
"Anything launched around the R2m mark is usually sold out before units are even properly marketed." Full-title homes priced between R2,5m and R4m sell quickly.
Du Toit says investors in properties for permanent rental can expect a good return on capital. "Returns on holiday accommodation are slightly higher, but that market is very vulnerable to the weather. For instance, many bookings over the Easter holidays were cancelled due to the foul weather."
Article by: www.aida.co.za