According to Propstats, the Western Cape Institute of Estate Agents’ respected statistical data service, the average sales price of an Atlantic Seaboard home is now R5,552,808. This represents an increase of close on 8% year-on-year. It also makes the Atlantic Seaboard one of the highest priced residential precincts in South Africa today.
The price rises, says Sandy Soller, franchisee for the Rawson Property Group on the Atlantic Seaboard, reflect the growing demand for homes throughout this precinct and the shortage of stock. When a home in one of the lower middle or middle class price brackets, she says, is correctly priced, it will sell within one week and some have sold within 24 or 48 hours.
“The average sales figures quoted by Propstats,” says Soller, “can be misleading because of course they reflect the exceptionally high prices achieved irregularly on top end properties in the Clifton, Fresnaye, Bantry Bay, Camps Bay, Bakoven and V&A Waterfront areas. The reality is, however, that in Sea Point, Green Point and Mouille Point it is still possible to buy at what by Cape Town middle class standards are still affordable prices.”
Prices of homes, especially sectional title units, in these lower priced areas, says Soller, have, according to her figures, risen by ± 12% in one year, but the majority are still usually available between R1 million and R4 million – and over 70% of this franchise’s sales take place in this middle price sectional title bracket.
The big exception in the sectional title sector, says Soller, are the sea facing Beach Road apartments which continue to be very much in demand, not only from South African but also from international buyers. Here, year-on-year average prices have risen from R20,000 to R30,000 per m2 and have resulted in typical two and three bedroom units selling from R2 million to R 3,5 million.
Buy-to-let investors, says Soller, are increasingly aware that Sea Point and Green Point are much in demand and are today buying apartments as fast as they become available, often targeting the less expensive units which they then upgrade.
“Rents are highly satisfactory right now,” says Soller, “and seem likely to continue to increase. A well appointed two bedroom sectional title apartment will rent out at R15,000 to R18,000 per month and even a single bedroom sectional title unit will probably achieve a rental of R7,500 per month, whereas studio apartments are available from R4,500 per month.”
Although this Rawson Property Group franchise focuses on the lower bracket sectional title market where at any one time they probably have 50 to 60 units for sale, while managing another 40 on behalf of landlords, they are, says Soller, along with certain other agencies, increasingly conscious that the Atlantic Seaboard’s freestanding homes priced at anything from R3 million to R35 million (or more) are now beginning to attract interest, especially from Johannesburg and international buyers. A real effort is therefore, she says, being made by her team to increase the stock levels here and to market such homes overseas.
“The big challenge in the upper bracket market,” says Soller, “especially in Camps Bay where there are literally dozens of homes for sale, is that far too many sellers are inclined to be unrealistic about their sales prices. Many are trying to achieve prices 15 to 20% above true market values.”
Sellers, adds Soller, are often also unwilling to grant sole mandates. However the Rawson Property Group and other agencies have ample evidence that properties sold via sole mandates tend to sell faster and at more satisfactory prices.
“This is a message which for some reason many sellers find difficult to accept,” says Soller.
Soller believes that the price increases seen over the last year or two will continue for the simple reason that in the middle and lower middle price brackets, demand is still way ahead of supply.
“Now is, therefore,” she says, “an excellent time to buy and if ever the age old estate agents’ slogan “Buy now or regret later” was truly applicable it is here on the Atlantic Seaboard today.”
For further information contact Sandy Soller on 021 439 4126 or at sandy.soller@rawson.co.za.
