Weekend Argus (Saturday Edition)
A life of wine and restaurants
The finer things in life boost desirability and values of vineyard neighbourhoods
IT IS no coincidence that the suburbs of South Africa’s primary wine growing regions rank among the most sought-after property in the country.
From Durbanville to Constantia to Stellenbosch, Franschhoek, Paarl and Somerset West, buyers are prepared to pay a premium for homes in these areas. Seeff chairman Samuel Seeff says that property value growth in these areas has consequently consistently outperformed the national averages even during challenging economic times.
“A vineyard lifestyle is highly desired, and the options are diverse. Those with bigger budgets can choose to invest in a wine farm or a boutique lifestyle estate. For others, the choice is a vineyard estate such as Fransche Hoek in the Paarl/Franschhoek Valley whereas others may choose an estate in Stellenbosch or Somerset West.
“For many though, it is a house in Constantia or Durbanville.
“Whatever the choice, it is the vineyard lifestyle that buyers are after,” says Seeff. “The attraction is also not just local, but buyers from across the country and globe are drawn to these neighbourhoods.
The areas are all relatively close to the city, and many residents regularly commute from Somerset West, Stellenbosch, Franschhoek and Paarl, according to Pierre Germishuys, Seeff ’s managing director for the winelands.
Clearly, a taste for the finer things in life is a big driver of the demand, says Seeff. These suburbs are some of the most scenic in the country with beautiful vineyard and mountain landscapes and escapes that combine with a rural lifestyle. Yet, residents have access to top class facilities including some of the best schools in the country.
“Wine farms rank as top leisure pursuits for local residents as much as for tourists. The opportunity to enjoy vineyard walks, a meal at one of their restaurants, wine tasting, the weekend markets and much more are part of the attraction of these neighbourhoods,” says Seeff.
In addition to the wine farms, these neighbourhoods are also home to six of the Top 10 restaurants in the country as ranked by the Eat Out Mercedes- Benz Restaurant Awards. Two of these – La Colombe at Silvermist Wine Estate and the Green House at The Cellars-Hohenhort Hotel – are in Constantia.
James Lewis, principal for Seeff southern suburbs, Hout Bay and Llandudno, says the vineyard atmosphere of the suburb is a key motivator for buyers and is also what makes Constantia a top performer when it comes to property.
Sales topped a significant R1.483 billion in value over the last year according to Propstats data. From January to May, sales already stand at just over R620m. Prices reached R27.5m in Brommersvlei Road and R51.5m in Southern Cross Drive last year.
Lightstone data shows that the median price for freehold property in Constantia is around R10m, up by 188 percent in the 10 years since 2005 when it was R3.475m and 54 percent since 2010 when it was around R6.5m.
The Durbanville area tells a similar story according to Joe van Rooyen, Seeff ’s licensee for the area. In 2005, the median freehold house price was around R1m. By 2010, is was 60 percent more at around R1.6m and by 2015, it had risen by 160 percent to almost R2.6m.
“The growth of the wine valley here is making Durbanville a sought-after neighbourhood now,” says Van Rooyen. “The livelier market over the last two years has consequently resulted in a number of sales comfortably above R3m to as much as R7.4m since early last year.
“The Durbanville landscape is every bit as beautiful as that of other winelands’ neighbourhoods and we also have mountain and vineyard views. Residents have access to about 12 wine estates such as Durbanville Hills, D’Aria, Bloemendal, De Grendel, Diemersdal and Meerendal. However, the area still remains very well-priced for a vineyard neighbourhood.”
For Stellenbosch, the wine farms are a big attraction on top of the excellent facilities including the university, says Germishuys.
Aside from globally acclaimed wine farms such as Beyerskloof, Blaauwklippen, Lanzerac, Spier, Rust en Vrede, Stellenbosch also has two of the top 10 restaurants – Terroir at Kleine Zalze and Jordan Restaurant at the Jordan Wine Estate.
“Stellenbosch property is now a hot commodity with steady year-onyear capital growth,” says Germishuys.
“In 2005 for example, the median price of freehold property was around R1m. By 2010, it had risen to R1.9m, 90 percent more in just five years. It now stands at around R2.8m, 180 percent up over the last 10 years.”
“Nearby Franschhoek is another area where vineyards attract buyers, with wine farms such as Babylonstoren, Backsberg, Boschendal, Haute Cabriere and La Motte and one of the top 10 restaurants, Le Quartier Français,” say agents Melina Visser and Adell Ferreira.
Franschhoek though has experienced a more modest price growth from an average freehold house price of R1.4m in 2005 to R1.8m in 2010/11, just 29 percent growth in five years. By 2015, the price had risen to R2.8m, up by about R1m in five years and about 100 percent up over the 10-year period.
“Buyers have paid from R3.6m to R4.25m for a home up to R7m to R10m in the village. In the vineyard estates homes have sold for R9.3m in La Ferme Chantele, R13.5m in La Avenue de Franschhoek and R9.53m to R18m in Fransche Hoek Estate. Yet you can still find a home in Fransche Hoek Estate for R6.95m.”
“The towns and villages of the winelands have excellent infrastructure and some of the best schools and universities in the country. Families especially have been heading to the winelands towns, so property values have risen by about R100 000 each year over the past three years,” says Germishuys.
“In 2005, the median value of freehold property in Paarl was just R638 000. By 2015, it had more than doubled to R1.3m and is now just over R1.4m. Luxury estate homes now sell for a median of R4.2m.”
In Somerset West property values have grown by 42 percent from a median value of R1.2m in 2005 to R1.7m in 2010 and by 92 percent to R2.3m in 2015.
Surrounded by vineyards, the village has two of the oldest wine estates in the country, Lourensford and Vergelegen, both with top restaurants, along with the newer Waterkloof wine estate that now has a top 10 restaurant.
Loretta Diab, manager for Seeff Somerset West, says Gautengers and other migrating buyers are finding the area irresistible.
“We estimate that 20 percent to 30 percent of buyer enquiries now come from other areas in South Africa,” she says.
“All of this interest has notably boosted activity and values. Since the start of last year for example, there have been several sales above the R5m to R10m-plus price band. Most of these were in the security estates such as Bel’Aire, Boskloof, Dennegeur and Erinvale, where properties have been sold from R14.5m to a very notable R22m.”