Luxury market going great guns
THE LUXURY property market in South Africa has been thriving over the past year, with tough economic conditions and Covid-related financial stress apparently not affecting high-end buyers.
The 10 most expensive homes in Cape Town alone fetched a combined R855 million last year.
In fact, last year saw the country’s second and third-highest property sales ever, as well as the highest sale ever for a plot of land.
The most expensive home in South Africa, in Cape Town’s Bantry Bay, was bought for R290m in 2016. Last year, Lance Cohen of Lance Real Estate sold an “incredible” home in Fresnaye, on the city’s Atlantic Seaboard, for R160m. This sale was the second-highest ever plus the most expensive home sold last year.
The property – described as a “magnificent five-bedroom home that offers pristine, uninterrupted views of the Atlantic Ocean and whose back yard is essentially Lion’s Head” – was not even on the market when an offer to purchase was made.
Cohen also sold last year’s second most expensive property – and third most expensive ever. The “exquisite” five-bedroom, five-bathroom home in Bantry Bay, sold for R125m. It, too, was purchased following an unsolicited offer. In addition, he says his R55m sale of a plot in Fresnaye last year was the country’s most expensive sale ever of a plot of land.
Property sales of R97.5m and R80m – both in Cape Town’s Clifton – appear to be the third and fourth highest sales
of last year.
These sales, agents say, are indicative of the high level of activity that has been seen in the luxury property market over the past year.
Although Cohen can’t divulge his buyers’ nationalities for privacy reasons, he says high-end South African properties are being snapped up by “a fair balance” of local buyers and foreigners
from countries such as Germany and Sweden, as well as other African countries.
“Some of these properties are used as holiday homes, especially during our summer, or are rented out.”
At the moment, there is a lot of interest at this end of the market.
“We are in a market that, although improving, is still a buyer’s market... Just
as the low end of the market has been very active, so has the high end. This is due to the value of the rand and the fact that property prices in South Africa during Covid dropped while, in many other countries, they climbed.”
Further evidence of luxury buyer activity is the fact that the Seeff Property Group made 12 significant sales of properties above R20m last year. These homes are on the Atlantic Seaboard and in Plettenberg Bay, Bishopscourt and Constantia, says chairperson Samuel Seeff.
“We also provided the buyer for a R62.5m sale in Franschhoek.”
In addition to this massive sale, the group sold a Plettenberg Bay home for R60m.
“This was a new record price for the area and the property sold twice within six months, first to a South African expat in May for R55m and then again for R60m to a local buyer as a second home.
“It is a spectacular beach house in a prime location in Beachy Head Drive, one of the top addresses in the country.”
Seeff says the group’s high-end sales included:
• A R52m home in Camps Bay’s Theresa Avenue, sold to a South African expat who lives in the UK, for use as a second home and then as a retirement property.
• A R45m home at the V&A Waterfront – a 509m² penthouse with a pool and exceptional views, sold to a German buyer as a holiday home.
• A R40m home in Head Road, Fresnaye, sold to a German buyer as a residence.
While last year was a “great year for property”, Seeff says the story of the year was the significant uptick in the R20m-plus sector and sales to foreign buyers which are at their highest levels in over three years.
“The luxury sector and trophy home sales, in particular, have enjoyed an excellent year, with a notable uptick in high-value sales, predominantly on the Atlantic Seaboard and in Plettenberg Bay.”
He says the country’s affluent areas, such as Sandton and Pretoria East, and luxury estates around the Johannesburg and Pretoria metros, have performed excellently in the R5m to R15m sector with a few sales at the high end.
“In the Durban area, Umhlanga has performed extremely well, as has Ballito and Zimbali, although predominantly in the R5m to R8m price band.”
Echoing this, Andrew Golding, chief executive of the Pam Golding Property Group, says much of the demand for luxury homes is driven by local buyers who have identified specific areas of interest and understand that the current market, “characterised generally by motivated sellers and well-priced stock”, presents opportunities that offer exceptional value for money.
“Apart from local purchasers in Cape Town’s sought-after, conveniently located southern suburbs, the buoyant Constantia high-end market has been mainly driven by buyers from Gauteng and Kwazulu-natal.
“We’ve also seen a notable increase in demand for properties listed above R10m on the Cape’s globally renowned Atlantic Seaboard,” Golding says.
Last month, the group’s highest sale for the year – and what appears to be the country’s fourth highest for last year – an R80m property in Clifton with direct access to the beach. The South African buyer plans to repurpose the multi-unit dwelling into a family home.
Nick Gaertner, director and chief operating officer at Knight Frank, says there was a “strong resurgence” of luxury property buying in the last quarter of 2021, and an even stronger start to this year.
“This suggests high-valued properties will perform strongly this year,” he says.