Weekend Argus (Saturday Edition)
Top year for Atlantic seaboard to keep summer sellers busy
THE ATLANTIC seaboard property market looks set to end the year on a stellar note and agents predict a busy summer for sellers.
This, despite the fact that this has largely been a year of consolidation for the market with overall volumes down year-on-year by about 20 percent on average, says Ian Slot, Seeff ’s managing director for the area.
“So far, it has been yet another year of excellent activity for sellers, in terms of demand and prices with more higher value sales coming through compared to even last year when the market peaked,” says Slot.
“The Atlantic seaboard area that stretches from the V&A Marina and Green Point nearest to the city to Camps Bay and Llandudno at the furthest point, just seems to retain its star quality year in and year out, despite the economic challenges.
“So we see for example that even though unit sales were down year- on- year, prices increased at well above inflation, by 13 percent to 22 percent. Overall, we have seen a market this year packed with willing buyers keen to invest in the area. Conditions have remained favourable for sellers and this is set to continue into the busy summer months and at least the first part of next year.”
According to Slot the mar- ket performance this year, although somewhat down in unit terms, has delivered excellent value with properties still selling almost as fast as they are being listed. By November, about 565 properties worth just over R4 billion had been sold.
“The overall average sales price was R7.2m compared to last year’s R5.8m, about 24 percent higher and an extra R1.4m a sale on average,” says Slot.
“This year’s average sales price for freehold property stands at about R12.1m compared to last year’s R10.7m, and R1.4m more a sale.”
He says sectional-title properties have experienced even better price growth. The average sales price this year is about R5m, about 22 percent higher than last year’s average of R4.1m. That means about R1m more each on average.
“What is clear is that there seems to be no price too high and buyers are willing to pay an ever higher premium for the right location. This also explains why we have seen more activity in the R20m-plus sector this year despite the overall contraction of the market compared to last year’s peak.”
Although sectional- title properties make up about 70 percent of the unit sales and freehold houses just about 30 percent, Slot says that freehold homes account for almost half of the value generated this year, yielding sales of just over R2bn.
“There has been strong demand for freehold houses in the Green Point area in particular this year, picking up about 27 sales at an average price of just under R6m compared to R5.2m last year. Just over half of all sales were above the R5m price band with R15.6m the highest price paid this year.
“In neighbouring Sea Point, 17 freehold houses were sold this year at an average price of R5.3m compared to R4.6m last year. Only six of these were above the R5m price band and the highest price paid for a house in the suburb so far is R10m in Rhine Road,” says Slot.
Agents Jessica Rother and Debbie Koping say the demand remains strong for houses in these two areas and the average freehold house price for both suburbs is up by about 15 percent year on year.
Camps Bay has come through with an absolute stellar performance this year according to agents Pola and Nadine Jocum.
“Here, about 60 freehold house were sold at an average price of almost R12.4m. This includes eight sales of homes above the R20m price mark, the most recent being luxury villas in Glen Beach and Theresa Avenue sold by Seeff to local cash buyers for R26m and R30m,” say the agents.
“It was the sub-R10m price sector that picked up the bulk of activity in past years, but this year the tables have turned with more than half of all sales above R10m.”
Fresnaye accounts for about 31 of the freehold houses sold at an average price of R13.6m. Activity includes three R20mplus sales ranging to a highest price of R56m. In Bantry Bay, about 12 freehold houses were sold at an average price of R17.7m with half of all sales falling above the R20m price band and ranging to a highest price of R29m.
Although only five freehold properties were sold in Clifton, these have come at an average price of R34m and a highest price of R111m, according to agent Lance Cohen.
“The activity has paved the way for a few new top-class listings, although these are being marketed on a confidential basis. This includes three luxury homes in Clifton, all with spectacular settings and sea views and luxurious living spaces with no expense spared on finishes. Prices range from around R150m to R200m,” says Cohen.
“Cape Town expects a busy tourist season with locals and foreigners likely to take advantage of the weak rand to spend their holidays in the city,” says Slot.