Apply dose of reality
Sellers in Plettenberg Bay are urged to catch the wave by pricing correctly. Michelle Swart finds out more
HOMEOWNERS in Plettenberg Bay who are hoping to sell their properties during the holiday season need to review their asking prices urgently, says Hein Pretorius, principal of the local Sotheby’s International Realty franchise
“Plett is still one of SA’S premier resort destinations and most desirable places to own property, and the market has shown a substantial increase in buyer interest and activity over the past few months compared with the previous two years.
“However, sellers who don’t want to miss this boat need to be sure that their asking prices are really competitive because the truth is that while there are more buyers around most are astute investors who have recognised that there is an unusual opportunity now, while prices are down, to acquire a bargain in this sought-after location and they stick to their guns on pricing because they know they have plenty to choose from.”
He says there is still a serious oversupply of property on the market following the recession and that actual prices being achieved in the home sales that are taking place are still about 25% to 30% off their 2007/2008 peak — that is, closer to pre-boom levels.
“For example, we recently sold a home where the owner netted R6,2m after spending R8,3m in 2008. I have also seen other sellers who two years ago refused offers that they considered too low now accepting even lower offers.
“This is a bad situation for them when one takes into account the time value of money, but it is what inevitably happens to properties that are overpriced. Buyers avoid them and they become stale after being on the market too long, at which stage they can usually only be sold for less than would have been achieved had they been correctly priced in the first place.”
Pretorius says there are many properties in Plett in this category and that part of the problem is that their owners are often not really in tune with the realities of the local market.
“Plett is primarily a second-home market so many owners are out of touch because they don’t live here for much of the year. On top of that, many local agents don’t seem to realise how dramatically the market has changed. You cannot value a property in the current market here by using sales values from two years ago.”
He says serious sellers should make sure that any valuations they are given are backed by information about sales that have occurred in the past few months, and get a second opinion if necessary.
“Of course no-one wants to hear that their property is worth less than they thought, but that is far preferable to having an agent who tells you what you want to hear and then brings you offers far below their own valuation, if at all.”
Data sourced from Lightstone shows that 45,24% of recent buyers in Plettenberg Bay have been between the ages of 18 and 35, while 47,37% of recent sellers have been aged between 36 and 49.
Lew Geffen Sotheby’s International Realty Hein Pretorius 083 701 3159
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