Black migration reversing?
WHO WOULD have thought 10 years ago that townships would become lucrative property investment destinations and that black buyers, who migrated to former white suburbs, would return in droves to their original home base? A report on township property trends released last week by First National Bank shows just that – white sellers in the suburbs may be packing for Perth but black sellers are packing for Soweto, Khayelitsha and Umlazi.
FNB Home Loans property strategist John Loos says its township survey suggests it’s no longer all one-way traffic to the suburbs. In Gauteng, 31% of township buyers are believed to be those wanting to return from previously white suburbs. In Durban and Cape Town that percentage is 24% and 26% respectively.
In Soweto alone, 38% of buyers are residents from former white suburbs. Loos says the flow of buyers back to Soweto may be coinciding with the rapid pace of retail development coming to the area.
Road and other infrastructure upgrades have also helped turn Soweto into a more attractive place to live, especially for middle-income households that have money to spend on shopping and leisure activities.
Loos says other drivers of the return to townships include cultural factors and affordability. Despite township house prices rising by an average 20% in the third quarter year-on year, township house prices are still much lower than in the suburbs.
Latest figures from property portal SA Property Transfer Guide (SAPTG) confirm township housing markets continue to experience boom times amid what’s arguably the longest and strongest slump ever experienced in SA’s suburban property market.
In fact, house sales in townships have surged to such an extent that those areas now make up around half of SAPTG’s monthly top 10 suburb ranking (in terms of highest volumes of sales). For example, in October Protea Glen, in Soweto, recorded the highest number of sales of all suburbs throughout SA, with 333 being recorded at the Deeds Office that month. Other townships included in SAPTG’s top 10 for October include Khayelitsha near Cape Town (106 sales), Shakaville (near KwaDukuza/ Stanger), KwaZulu-Natal: 234 sales) and Toekomsrus (Oudtshoorn: 105 sales).
Compared to volumes in some of Johannesburg’s popular northern suburbs. Bryanston notched up only 18 sales in October, Morningside 11 and Fourways Gardens 10.