Women form the majority of first-time property buyers, and are steadily reshaping the local property market under favourable investment conditions
WORDS: DEBBIE HATHWAY – PHOTOS: SUPPLIED
The FNB HPI annual house price appreciation for February rose to 4.2% year on year, up 0.3% from January. However, according to the latest FNB Property Barometer, price growth continues to slow on a month-on-month basis. This is consistent with estate agents survey data, which indicates strong but slowing buyer demand, mainly in the middle-priced segments of the market. “We continue to see bigger, mainly freestanding, properties gaining in popularity, with buyers responding to the demands of remote working,” says Siphamandla Mkhwanazi, FNB senior economist.
In fact, much of the reflation in 2020 was driven by middle segments, buoyed by low interest rates, demand for spaces that facilitate remote working, and tenants becoming homeowners. Looking ahead, house price inflation (HPI) could drop to 2.1% or rise to 5.2% in 2021, states Lightstone, a leading provider of comprehensive data, analytics and systems in the property industry. If HPI reaches between 3.1% and 3.5%, this will negatively affect the performance of sectional title properties. Their freehold property forecasts tend to track inflation while sectional title properties are influenced by other factors.
Reflecting on the resilience of South Africa’s housing market and its ability to provide opportunities for homeownership, Andrew Golding, chief executive, Pam Golding Property group, notes the preferences of first-time and repeat buyers shared by Lightstone. Most first-time buyers enter the residential property market in the R700,000 to R1,5m price band, rather than in less expensive valuation bands. Both first-time and repeat buyers usually want three-bedroom, two bathroom homes. Women are mostly first-time buyers while men are mostly repeat buyers. Sectional title and estate properties are particularly appealing to women as they tend to offer better security.
The Rondebosch development in Rondebosch, Cape Town
Safety is one of the main reasons people move, woman and child safety especially, as cited by New World Wealth in their third edition of the Global Migration Review sponsored by AfrAsia Bank. What better way to do that than with the estate lifestyle where you invariably get space, nature and scenery to boot? Wildlife estates tick all of those boxes and are becoming more popular since the pandemic has influenced so many aspects of work and home life. “Buyers are now looking for properties where they can still enjoy an outdoor lifestyle in the safety of an estate,” says Samuel Seeff, chairman, Seeff Property Group.
Wildlife estates are characterised by natural scenery, free-roaming game and an abundance of birdlife, while being located close enough to essential amenities. Listening to the waking calls of the bush inhabitants and enjoying a bushveld braai and sundowner cocktails later on, are fairly unbeatable when it comes to the magic of Africa. Often sought-after as second homes, many also invest in estates for Airbnb purposes or for rental returns. They’re also attractive to foreign investors. Among the popular estates to invest in right now are Lekwena Wildlife Estate in Potchefstroom where prices start at R760,000 for a 2,000m2 plot. House plans range from 150m2 to 1,400m2 but there’s no deadline when construction must begin.
Thorny Bush Estate in Mokopane is a wildlife and golf estate, bordering the town of Mokopane which boasts a strong economy. Properties are sold as freehold erven and owners can build their own homes according to architectural guidelines. Wildlife roams freely among the properties, yet the estate is still dog friendly as long as the property is well fenced by the owner. Stands range in size from 600m2 to 4,000m2 and prices range from R500,000 to R1,2m.
Meanwhile, those looking to retire in a magnificent natural environment in the Lowveld can now look to Mataffin Macadamia Lifestyle and Assisted Living Village in Mbombela. Mataffin Macadamia is designed as a modern village with traditional community living across generations in mind. It’s just off the N4, less than 10 minutes away from city conveniences, but in a countrified location surrounded by litchi orchards that attracts a variety of birds and wildlife. Senior Lifestyle Two is the new phase now selling through Seeff. Designed for those aged 49+, it offers 14 sectional title units, each with two bedrooms, two bathrooms and a single garage, priced from R1,575m.
Those who need a good balance of city and estate living would do well to invest in Horizon Capital’s The Vera in Vredehoek, which forms part of the Cape Town City Bowl. Apartments start at R1,595m. There are only 15, including a few penthouses, and you get the benefit of being close to mountain walks too. There’s a sense of community in this part of the world that’s difficult to beat, with quaint restaurants that have a number of devoted local patrons. In a way this is reflected in the design, which is described as complementing the architectural language of Vredehoek. The Vera is a modern take on the prevalent art deco style of the 1930s, featuring soft lines and rounded edges with interiors and finishes that befit a private sanctuary.
The sectional title sector in Cape Town fared remarkably well last year. “Young buyers have added significant strength to the residential property market, particularly in the R700,000 to R2m price band, which offers investors considerable options in the sectional title sector,” says Dave Burger, sectional title specialist, Lew Geffen Sotheby’s International Realty in the Southern Suburbs. “In Rondebosch and Mowbray, Lightstone data reveals that sectional title median prices rose from R1,65m and R1,1m in 2019 to R1,7m and R1,19m respectively.”
The academic belt continues to attract buyer interest. “Given the relative expense of living in private, dedicated student accommodation, owning an apartment for the duration of a four-year degree and selling it thereafter makes financial sense,” he says. According to Burger, the most popular units are two-bedroom flats priced below R2m and one bedroom apartments priced up to around R1,5m in blocks that offer 24-hour security and undercover or secure parking. The Garden Route is a property investment hot spot. Lightstone data confirms that sectional title median prices in Knysna rose from R835,000 in 2019 to R950,000 in 2020, while in Plettenberg Bay these remained steady at R1,5m.
Peter Maré, co-principal in Knysna and Sedgefield for Lew Geffen Sotheby’s International Realty, says that much of the towns’ recovery is due to a resilient market underpinned by ongoing semigration. “Despite the subdued economy and the disruption of the pandemic, the property market has remained fairly strong and we’re fielding enquiries from a growing number of families looking to relocate from the bigger cities in search of a different lifestyle that will afford them a better quality of life. Interestingly, we’re also seeing considerable interest from German buyers amid increasing concern in Europe about the viability of the European Union and the financial burden that will be placed on productive countries within the EU.”
Tim Kirby, George and Wilderness principal for the group, notes a shift in the buyer demographic in his area. Buyers hail from Gauteng, the Free State and Cape Town, and comprise some retirees but mainly young professional families between 35 and 45 years old. “The pandemic has shown professionals that they’re able to work remotely and can therefore live wherever they choose to. George meets all their needs,” he says. Here, the median apartments price grew from R772,000 to R900,000.
The interior of Horizon Capital’s The Vera in Vredehoek