The rise of second-tier cities
Smaller South African towns are growing as people realise opportunities for more affordable living and working environments. HomeFront investigates
he AfrAsia Bank SA Wealth Report 2019 by New World Wealth flags several small-town hotspots in the Western Cape and KwaZuluNatal as being among the most exclusive in the country in terms of property investment. Plettenberg
Bay, Knysna, Stellenbosch, Paarl, Franschhoek, George, Hermanus, Wilderness, Umhlanga, La Lucia and Ballito feature homes around the R20m mark, according to 2018 figures.
Up-and-coming towns nearby are Nature’s Valley and Keurbooms (near
Plett) and Zinkwazi (on the KwaZulu-Natal North Coast), the report says.
Meanwhile, metros outside urban centres are becoming more appealing to businesses and families. Known as second-tier cities, these hubs include Mbombela, Kimberley, Rustenburg, Bloemfontein, Port Elizabeth and Polokwane.
Affordability aside, what underpins growth in these areas is improved quality of life, which depends on infrastructure keeping pace with development. That
Tmeans continued pressure on authorities to provide basic services, education, healthcare, policing, telecommunication networks and roads.
HIGH GROWTH AREAS
The United Nations estimates that 71.3% of the South African population will live in urban areas by 2030, and almost 80% by 2050.
Gauteng, the Western Cape and eThekwini are expected to have the highest growth, according to the Department of Agriculture, Land Reform and Rural Development’s Draft National Spatial Development Framework.
“Significant movement will also take place from villages and small towns to larger, better connected towns located on major routes,” the document predicts. “Both large urban regions and rural areas will require targeted and appropriate government focus and attention.”
Municipalities will need financial and technical support from the private sector too, it says.
PUBLIC-PRIVATE PARTNERSHIPS
Recently launched Conradie
Park in Pinelands, Cape Town, is a good example. SA’s first fully integrated mixed-income housing development aimed at reversing apartheid spatial planning is the outcome of a partnership between developers Concor and the Western Cape Government. The 22ha community comprises more than 3,500 homes, some of which are subsidised or grant-funded, with the remainder for sale on the open market from about R950,000.
The development is an incubator for growth and evolution, says head of sales Wayne Lawson. “It’s aspirational – those renting subsidised housing will be inspired to buy subsidised properties. Subsidised homeowners will in turn strive to buy their first house on the open market. The model provides social and financial support for this.”
Phase 1 has been launched and the public is keen to be part of a connected, multicultural community marked by affordability, sustainability and security, says Toni Enderli, founder of Realtor of Excellence.
The model demonstrates how state-owned land can be unlocked to boost economic growth while providing mixedincome housing in one neighbourhood. Located near main arterial routes and railway stations, the project involves a longterm transport master plan, potential new MyCiti routes and road upgrades.
Concor project leader
Mark Schonrock says the R3bn development will also stimulate small business growth through 10,000m² of retail and, initially, 14,500m² of commercial space – all designed by architects DHK and Jakupa. More than
2,000 jobs will be created during construction.
Included are two schools, several creches, a hotel, an urban gym and pet-friendly parks. Foot and cycling paths are part of an integrated nonmotorised transport plan and green technology has been applied to energy, water and waste management.
The first phase comprises 99 units and occupation is set for early 2021.
TRANSPORT HUBS
SA’s second-tier city landscape resembles what
Craig Mott, Western Cape regional sales manager for Rawson Property Group, predicts that Johannesburg’s northwestern suburbs will become investment hotspots for firsttime buyers and investors should President Cyril Ramaphosa’s plans for the 5G-ready smart city in Lanseria be successful.
“If all goes well, this will be one of the largest and most innovative property developments in SA,” says Mott. “The project is set to be a benchmark for green infrastructure. It will provide electricity, water, digital infrastructure and roads for 350,000 to 500,000 people within the next decade.”
The envisioned Lanseria Airport City is a joint project between the Investment and Infrastructure Office in the Presidency and the Gauteng and North West provincial governments, working together with the cities of Johannesburg, Tshwane and Madibeng.
Neighbouring suburbs Sandton, Midrand and Fourways will also benefit as they are easily accessible from Lanseria.
“Improved transportation systems and town planning often signals where the next property hotspot will be and contributes to a shift in buyer patterns with a medium- to long-term view,” says Mott. “Rising demand for smaller homes in conveniently located areas creates opportunities for renewal of older suburbs close to city centres and public transport hubs – and even old industrial and commercial areas, where run-down properties can be recycled into decent, affordable accommodation for young firsttime buyers and renters.”
This way, cities can make optimal use of existing utility, transport and communications infrastructures, become more inclusive and reduce “crime and grime”.
“There is downward pressure on prices of large, old homes in many heritage suburbs now, which creates more latitude for owners and developers to subdivide or rezone and build the upmarket apartments and clusters for which there is strong demand,” he says. “These will generate a much higher return. The resulting job creation, resurgence in property market activity and boost for the construction industry will ultimately contribute to positive economic growth.”