The South African residential property marketing sector must “latch onto” the reality that the number of tourists to this country is increasing dramatically – and this will open up a new market for home sellers, says Bill Rawson, Chairman of the Rawson Property Group.
“We are told that 13 million foreigners now enter South Africa every year, and that somewhere around eight million are tourists or businessmen adding a tourist component to their visit. This figure, it appears, is rising by 4 to 6% per annum – certain of the figures of visitors from some of the Asian countries are growing by far higher percentages: China, for example, in one year (October 2012 to October 2013) increased the number of its visitors by 17.1% and Japan by 19,4%.”
The traditional visitors to South Africa who have been coming for many years, said Rawson, are the UK, which in 2012 to 2013 sent some 350,000 tourists to SA, Germany – 234,000, and the USA and Canada, which together provided SA with just under 350,000 tourists last year. However, the growing numbers of Chinese and Japanese visitors – 127,000 and 50,000 in the period mentioned is particularly noteworthy.
“I have recently been in Australia and was impressed by the large numbers of Asian tourists that I came across. I was told time and again that visitors from these countries often become investors and that they often do this on a large scale,” said Rawson. “For example, the Chinese on several occasions have bought whole blocks of apartments. I believe much the same thing could happen in South Africa if we were to cultivate these markets better.”
Cape Town, said Rawson, is likely to be the main target for foreign visitors looking for a place to buy.
“The New York Times’ recent assessment that Cape Town is now the best place in the world for tourists from the northern hemisphere to visit was, I believe, wholly accurate and justifiable. Cape Town does offer a wonderful array of natural and outdoor entertainment facilities – beaches, mountains, wineries, restaurants, as well as golf and race courses, at prices that, at today’s exchange rate, offer incredible value for many visitors. This, of course, applies with equal validity to the homes for sale here which, by first world standards, are exceptionally good value.”
One of his group’s Constantia agents, Gerald Romanovsky, said Rawson, has recently pointed out that a five-bedroom home in upper Constantia on a 10,000 m2 plot is now selling at R12m and this price is equivalent in real terms to a two-bedroomed flat with just over 100 m2 of floor space in central Berlin or central London.
Those keeping track of the financial and political trends in SA, added Rawson, will also be greatly encouraged by the recent Moody’s International Credit Rating which gave Cape Town an ‘A’, i.e. a low credit risk, only two rungs off the top of their ratings ladder.
“The rating,” said Rawson, “reflects Cape Town’s ability, especially in relation to all other major South African cities, to retain a strong financial position, avoid debt and implement improvement policies. The Moody’s report actually stated that Cape Town’s ‘strong governance’ is focussed towards maintaining a financially sound municipality and, it adds, that the budget execution, cash flows, debt and liquidity control are all well-handled.”
This report, said Rawson, should be used as widely as possible to encourage foreigners to be buying in Cape Town right now.
