Cape Towns city bowl offers solid investment return
Gerlinde Moser, Broker/Owner of RE/MAX Living which operates in Cape Towns City Bowl and Atlantic Seaboard area including the Waterfront, says that many South Africans who have been working overseas are now moving back and buying property here, while investor buyers are also active in these areas. This is because the City Bowl and surrounds offers an excellent return on investment and there is huge demand for short term and long term rental properties in the area.
She says that in the upmarket areas of the City Bowl, including Higgovale, the number of properties being sold in the area has increased this year and the average price in the area has either increased or remained relatively stable. As the market continues to improve, sellers are not forced to sell and can start asking higher prices. Sellers are however cautioned to trust their real estate agent when given a valuation or price recommendation when marketing their property as buyers are well educated in this market and will not consider a property that is not priced correctly.
She says that overpriced properties in Higgovale are now growing into their asking prices. We have seen a huge demand for family homes in the upmarket areas, due to the proximity to good schools as well as less wind than on the Camps Bay side. We also have excellent security, thanks to three private armed response companies, actively patrolling these suburbs.
Moser also notes that there is a massive shortage of family homes to rent, which is reflected in the recent record let in Higgovale for just under R90 000 per month.
An entry level apartment in the City Bowl, Vredehoek or Gardens can be purchased for between R1,2 million and R2 million, but buyers need to remember that parking is at a premium. An entry level home in this same area will cost anywhere from R2,5 million upwards. Buyers are willing to pay between R30 000 and R39 000 per square meter for fully renovated designer apartments as well as small luxury homes with good security, says Moser.
RE/MAX Living is currently marketing The Higgo Firs sectional title development that has 30 units in total. The apartments vary from studio apartments to one-, two and three-bedroom apartments with sizes ranging from 39m2 for a studio apartment to 112m2 including the patio and swimming pool for the largest three-bedroom unit. Here prices range from R1,35m to R5,8m including VAT.
Richard Paradise of the Atlantic Seaboard office, who recently concluded a sale of R18m in Clifton, is currently marketing a sectional title development in Gardens, Cape Town. Priced between R499 000 and R1,295m, the development offers 22 units with parking, and the units can be purchased either renovated or un-renovated.
Moser notes that there has been an increase in the number of buyers looking for a property to renovate, which she partially attributes to the more positive attitude in the industry and the increase in investor buyers. Cape Town is rated as one of the top cities in the world and property in certain areas of Cape Town is still reasonably inexpensive compared to the rest of the world. Value for money such as this cannot be found anywhere else, she says.
In Higgovale, for example, record selling prices were paid for un-renovated properties on large stands. A 1900m2 property sold for R13m to a cash buyer who will demolish the current dwelling and start construction of a brand new family home in the New Year. The other was a 30-year old house, situated on a 1200m2 with exceptional views. This sold for R10,950m and the new owners will occupy it as is for now with the view to undertaking extensive renovations within the next two years, says Petra Davidan, a member of the Gerlinde Moser International Sales Team.
Says Adrian Goslett, CEO of RE/MAX of Southern Africa: Aside from its natural beauty, the greater Cape Town area has a range of amenities to offer property owners, from excellent schools, to shops, theatres, Blue Flag beaches and more. It comes as no surprise that returns on property investments within the City Bowl area, the hub of the city, continue to remain solid.
Talking about the property market in her areas over the next 12 to 18
months, Moser anticipates that property transactions will continue to
improve but she says it will take a while before we see any major positive
trend. Sellers can be cautiously optimistic, but again, must remember
not to price themselves out of the market. Badly priced properties just
will not sell, so pricing is most important. Well priced properties will
virtually sell within two weeks, where some stale listings may take more
than two years to sell, she concludes.
Article from: www.remax.co.za