In the area 1 - Lephalale
in the Limpopo Province, Lephalale, the town formerly known as Ellisras,
is fast becoming a real estate hot spot due to unprecedented industry growth
in the area.
Margarita Geyser, Broker/Owner of RE/MAX Adventure Properties, says that the town is the future of power generation in South Africa, and the planned growth makes real estate in the area an ideal investment opportunity for any prudent investor or Lephalale resident.
Geyser explains that Lephalale is currently home to the worlds largest dry-cooled power station, Matimba, as well as the worlds largest open cast coal mine, Grootgeluk. She says that the World Banks multi-billion rand loan to Eskom that was approved earlier this year has ensured the development of the Madupi Power Station, which is currently in the process of being built.
She notes that Lephalale is a hot bed of other new industrial developments as well: Another mine, the Exxaro Coal Mine, is expanding to the tune of R9,5-billion, the construction of another brand new coal mine, Boikarabelo, is in the pipeline and is set to begin early next year, and Eskom is busy with Environmental Impact Assessments on the possibility of building a further three new power stations as well as the possibility of developing a coal-to-liquids plant for Sasol.
And of course, with all this new development, comes an influx of new residents and an increased demand for housing and various lifestyle amenities. Says Geyser: At this stage, Lephalale has about 45 000 people living in the town. By 2016, the town population is expected to increase to 100 000 people, and by 2030, the population is estimated to be in excess of 200 000. Obviously, this is a great prospect for real estate in the area, as it means that there will be a constant demand for property in Lephalale for the next 20 years and that demand will most likely outstrip supply, which is good news for buy-to-let investors.
She says that RE/MAX Adventure Properties sales have experienced a year-on-year increase of 50% when compared to this time last year. The prices of houses have risen dramatically as there are few residential properties for sale and a lot of buyers. This is obviously boosting the rental market and making it a very attractive proposition for many investors, she says.
The price of an average entry-level, newly built, two-bedroom home in Ellisras ranges between R600 000 and R1,3m. Prices of mid-level homes, which are usually situated on a stand of approximately 1000m² and measure around 150m² under roof, range between the R850 000 and the R1,6m mark. Homes at the upper-end of the market begin selling at around R1,7m.
With regards to the market, Geyser explains that there is a true mix of buyers, which comprise mostly contractors that are semigrating from all over South Africa and bringing their families with them: Most of the buyers are selling up their homes, moving to Lephalale and buying new homes in the area. I would say that approximately 90% of these buyers work for either Exxaro or Eskom, and that the remaining 10% comprise private entrepreneurs or business people.
According to Geyser, current residents are cashing in on the increased demand for real estate by sub-dividing their properties and either selling the land or building a house or flat on it and renting it out.
Obviously, along with the increase in demand for residential property, Geyser says that there will be a lot of development with regards to lifestyle amenities in the area: A new R600m shopping centre is currently being developed in Lephalale and is set to open its doors in September next year. Located on a 12-ha site in Onverwacht, adjacent to the existing town centre, the development includes a 42 000m² shopping centre, of which the R400m first phase will comprise between 32 00m² and 35 000m². In a linked project, developers plan to build a 17 000m² office park adjacent to the shopping centre as well.
Says Adrian Goslett, CEO of RE/MAX of Southern Africa: Although
the enormous development in Lephalale remains a controversial issue among
many environmentalists, all the proper environment impact assessment studies
are being undertaken for the current or proposed projects to ensure that
the development takes place in the most sustainable and environmentally
responsible manner possible. There is no doubt however, that the proposed
industrial growth will have an enormously positive impact on the wellbeing
of Lephalales residential property market, which will no doubt be
felt by both current and future residents of the town.
Article from: www.remax.co.za