Mother City prices not for young pockets

A generation is parking their ownership dreams in rentals until they can own a piece of the pie

BUYING a first home has always been tough for Capetonians, who have to compensate for living in one of the most beautiful parts of the country by forking out much more for property than citizens living elsewhere.

Now, not only high property prices, but also stricter access to finance can make owning a firsttime home in Cape Town even more onerous. And the figures show it.

Only 8% of those buying property in the Western Cape are firsttime buyers. This is way lower than Joburg and Tshwane’s 27% and 21%, respectively, of total first-time homebuyers, according to FNB’s Estate Agent Survey, as quoted in the latest TPN Rental Monitor.

For many, it means not buying homes in their first-choice areas, or delaying their purchases with the rental option being relatively more attractive.

The latest TPN Rental Monitor, written by FNB property strategist John Loos, finds the upward pressure on house prices has contributed to a “major affordability challenge” for many in the “relatively land scarce” Western Cape, especially – but not only – among younger aspirant first-time buyers.

“It has become

Young professionals do tend to have bigger budgets and often buy in areas such as the CBD, Sea Point, Green Point and De Waterkant, Seeff adds.

Other areas where first- time buyers are looking, according to Pam Golding Properties agent Carol Knopf, include Rosebank, Mowbray, Park Estate, Observatory, Woodstock, Plumstead, Kirstenhof, Bergvliet and Claremont.

There is also high demand from this buyer demographic in Somerset West, the City Bowl and the northern suburbs, says Harcourts South Africa CEO Richard Harcourt.

“In the City Bowl, it tends to be young professionals wanting to be closer to the CBD, and in Somerset West it is young families looking for lifestyle living.”

Harcourt says: “Property is an investment and most see it that way. ...Some may start looking in areas that suit their budget instead of not buying at all.”

First-time buyers may also look for properties which do not fulfil all their needs, says Knopf, explaining that they may buy a property with only two bedrooms, or one without off-street parking.

“Affordability and ease of access to work, shops, schools and services are primary considerations. Price is a real consideration in Cape Town and buyers are trying to get larger bonds so they can get a foot in the property market,” she says.

PICTURE: POWER DEVELOPMENTS Affordable housing developments, such as this one in Pelican Park by Power Developments, are increasing the number of first-time buyers in the area.