In the area 2 Natal Midlands
Inland of Durban, nestled between Pietermaritzburg and the Drakensberg Mountains, lies the Natal Midlands. Considered to be an idyllic location for some rest and relaxation, this is a scenic area filled with stretches of farmland, charming little towns and a wonderful arts and crafts route.
The Natal Midlands seems to have it all from the Midlands Meander route, Howick Falls along with the nature trails, picnic spots and some of the best bass fishing and birding within the Albert Falls Dam Nature Reserve to the Kamberg Nature Reserve which is framed by the Drakensberg Mountains and the Loteni Nature Reserve.
Its no wonder then that the Midlands Meander has become a thriving economy in its own right. And while farming is still the life-blood of the area, it is no surprise that this region has become very popular as a retirement and weekend getaway destination.
According to Pelham Henwood, Broker/Owner of RE/MAX Midlands, who has a number of years of real estate experience in the area, with offices in Pietermaritzburg, Pietermaritzburg East, Howick and Hilton, small holdings and lifestyle homes are very popular.
Property prices in the Midlands, he says, have stabilised at about 20% off their peak. However, underlying demand for property remains strong and as the banks re-assess their appetite for risk, more people will become eligible for finance.
Talking about properties available in the region, Henwood notes that while they have an abundance of stock on their books, most of it is overpriced and will remain unsold until the market recovers or until sellers adjust their prices to meet the current market. However, he says, those sellers who are tuned to accepting market-related prices are achieving positive results. Investors are also making a reappearance which confirms a positive outlook for property going forward.
Typically, Henwood says that a family home designed with three bedrooms, a lounge, dining room, family room, swimming pool and double garage can be secured for between R900 000 and R1,3m, depending on the location. But its the two-bedroom apartments which remain the most popular target as generally speaking they offer the most attractive return on investment. Currently, net returns of 6% - 8% can be achieved, he says.
The influx of civil servants over the last two years has underpinned the demand for property especially in the rental sector. Vacancies are minimal provided the required rental falls within the popular band of affordability which is currently under R5 000 per month.
Henwood notes that free-standing homes on the periphery of the CBD which, with re-zoning, can be converted to commercial use are also popular. These properties often require refurbishment, but the exercise is well worth it since medium term returns are very attractive.
Commenting on a significant change in the average buyers profile for the area, Henwood says that approximately 60% of his offices turnover is predominantly from sales to civil servants. Their buying power, based on income, converts to the purchase of homes or apartments in the R550 000 to R1m price range. The retirement market is also active. Here empty nesters are trading in the traditional family home for a lock-up-and-go lifestyle within gated communities.
Says Adrian Goslett, CEO of RE/MAX of Southern Africa: The Midlands offers a very attractive lifestyle for residents and is situated conveniently close to the coast and to the Drakensberg. It also offers a variety of amenities including excellent schools and a university.
Henwood concludes by saying that he expects a gradual improvement in the property market through 2010, a turnaround which he believes will be stimulated by the lower interest rate regime and improved consumer confidence.
Article from: www.remax.co.za