In the 15 months since he established the Rawson Property Group’s Cape Town CBD franchise, says Alisdair Crofton, the franchisee, the average price of both sectional title and freehold properties in this area has risen by approximately 25% - and certain properties have exceeded even that growth rate.
In response to the steadily growing demand, Crofton has strengthened his team to the point where there are now eight people serving his franchise and he anticipates taking on several more agents before the end of the year.
Remarkably, too, for so young a franchise, the Rawson Cape Town CBD team has quite often been ranked in the top ten of the Rawson Property Group (against 220 other franchises spread across the country) and in almost half the months of the last year has featured in the top 20 performers.
“This no doubt tells one something about the enthusiasm of our young team (almost all of whom are still in their intern year, monitored and coached by Crofton himself) but it also,” says Crofton, “confirms the numerous socio-economic commentators who have time and again told us that a revolution in lifestyle and housing is now in full swing."
“It is quite clear,” says Crofton, “that commuters are no longer prepared to waste time in traffic jams and are determined to live within 30 minutes (at the most) of their work or study places – even if this means cutting back drastically on living space and doing without a garden.”
Almost any reasonably priced CBD freehold property will today “dance out of the door” in a matter of days, says Crofton, and sectional title units are almost without exception snapped up within four to six weeks unless they are ridiculously overpriced.
The wide CBD price range, says Crofton, enables his team to offer buyers homes at anything from R1,3 million to R20 million or more. However, most sales take place in the R2,5 million to R5 million bracket and at least 75% of these sales are sectional title.
As indicated, prices at this level are rising with unprecedented speed – so much so that even experienced valuers occasionally underestimate what a home will sell for and offers above the list price have occurred more than once. The banks’ valuers, adds Crofton, often have to be updated with comparative market analyses to bring them in line.
As a result of the demand, a 40 m2 bachelor flat sold by the Rawson Property Group in the Gardens Centre achieved a price of R1,250,000 – R200,000 more than had ever before been paid for so small a unit in this centre. Another apartment (in a different block) sold only 14 months ago for R1,3 million has just been resold at R2,2 million, while for a small semi-detached home on a 182 m2 plot, Rawson Cape Town CBD received a cash offer of R5,250.000 – regrettably after the owner had already accepted another.
As in all high demand price booms, says Crofton, success can have its drawbacks. This Rawson franchise has some 500 buyers listed but even in the best months seldom has enough properties to offer, most of which are sectional title.
In the circumstances, sticking to the tried and tested estate agency basic operational rules, says Crofton, is all important – and this includes tirelessly canvassing on foot, by telephone and by other means for properties. A new agent recruit, Annette Coetzee, had at the time of writing just completed a knock and drop exercise at all the 255 apartments in Disa Park and efforts of this kind are continuing daily.
Will this property price bubble burst? Are these prices sustainable?
Crofton says that they could slow down, but they will certainly not stop.
“With demand at its current levels,” he says, “prices seem set to rise further - but those buying into the CBD often gain not only in greatly reduced commuting times but also in lifestyle. Consider for a moment what we have to offer. The whole of the east face and slopes of Table Mountain are in our backyard and can be walked over and picnicked on at any time. The V&A Waterfront and the beaches are only ten minutes away, as is UCT. At night the whole bon vivant cosmopolitan way of life centered on the cafés, bistros, restaurants, cinemas and art galleries are right there to be enjoyed.”
For further information contact Alisdair Crofton on 021 462 2116.
