fbpx
FREE CONSULTATION
FREE APPRAISAL

Tag: Properties for sale

Categories
Blog

Residential real estate represents the world’s most significant store of wealth

In 2022, the value of all global real estate – comprising residential and commercial real estate, and agricultural land – reached $379.7 trillion, maintaining the asset’s position as the world’s most significant store of wealth.

This is according to research by global real estate services provider, Savills, who point out that real estate is more valuable than all 2022 global equities ($98.9 trillion) and debt securities ($129.8 trillion) combined, and almost four times that of global GDP ($100.6 trillion). The value of all the gold ever mined, by comparison, stands at $12.2 trillion – just 3% of the value of global real estate.

Notwithstanding the fact that overall, the total value of global real estate in 2022 decreased 2.8% from 2021, when it was $390.5 trillion, it is still up 18.7% on 2019 pre-Covid levels. Growth across all asset classes (real estate, equities etc) slowed in 2022 compared to 2020-2021, according to the international real estate advisor, as inflation rose and interest rates spiked.

Comments Dr Andrew Golding, chief executive of the Pam Golding Property group, which is Savills’ exclusive residential real estate partner in Africa: “Positively however, according to the research report, the value of all sectors of real estate, remain up on their 2020 levels. Notably, in terms of the different property sectors, residential is by far the largest, accounting for 76% of all global real estate value, and its value stood at $287.6 trillion in 2022, a decrease of 1.6% on 2021 levels ($292.2 trillion). Here in South Africa, it is estimated that residential property is notionally worth some R6.6 trillion (approximately USD343 billion).”

Savills says that commercial real estate value stands at $50.8 trillion (2021 comparison: $51.7 trillion), comprising 13% of total real estate value, and ahead of the total value of agricultural land at $41.3 trillion (2021 comparison: $46.6 trillion) which accounts for 11%.

Paul Tostevin, head of Savills World Research which carried out the analysis, comments: “Despite upheavals in the markets, and some speculation about the future of some sectors, real estate as a whole continues to be the largest concentration of wealth in the world.

Says Tostevin: “Residential property dominates, and between 2019-2022 its value grew 21.1% – only outperformed by gold – as it benefited from ultra-low interest rates over this period, coupled with a focus on the home in many countries during lockdowns. It’s clear that given the under-developed nature of real estate in some locations, on a long-term basis growth will continue as more stock is added around the world.”

Value growth by asset

Floating USD exchange rates, Source: Savills Research

As of 2022, China was the world’s most valuable real estate market, accounting for 26% of total global real estate value (residential and commercial), followed by the United States which accounts for 19%. Savills notes, however, that Canada (7th) and Australia (10th), both countries that have seen significant growth in residential prices in recent years, rank ahead of much more populous nations for total real estate value. India, the world’s most populous country, is in 14th position by value, demonstrating the potential for future growth in this market.

Adds Dr Golding: “Being a nation with a predominantly youthful population, there is a positive demographic dividend for the South African residential market as the proliferation of new, smaller households in the key urban areas ensures ongoing, strong demand for accommodation. Increasingly this is being met via the conversion of commercial properties into mixed-used residential developments as well as new homes in coastal provinces as a result of semigration, but either way, South Africa’s youthful demographic profile will provide a fundamental underpinning for the local residential market as the influx of new, young homeowners ensures ongoing demand, in turn facilitating the movement of existing homeowners up the property ladder.”

Original Article: https://www.myproperty.co.za/news/market-and-opinion/residential-real-estate-represents-the-world-s-most-significant-store-of-wealth-03-10-23

Categories
Blog

How to avoid buyer’s remorse as a first-time home buyer

You’ve just gotten the keys to your first home, and you’re busily packaging your life into boxes and daydreaming about the magazine-worthy spread you’ll soon have. It’s pure elation, right up until it’s muddled with that sinking, “oh no, what have I done?” sensation.

Buyer’s remorse, a reality that is not spoken about enough in real estate, happens far more often than we would like to admit.

It’s all too easy to get swept up in the moment – especially for those fresh on the home-buyer scene. Viewing properties, imagining your life in a new home…and without the proper planning and research, you might end up buying a home that isn’t the right fit for you.

This can be avoided and our top three tips will save you from those post-purchase blues.

Budget and then go lower

Shopping too close to what you can afford might not leave enough room to actually live comfortably within your means. If you can afford to buy a home in the R1,5 million bracket consider shopping around in brackets a R100 000 less as well – you will have more money at the end of each month if you use the extra money to put into your deposit as it will result in a smaller bond repayment. This also allows you to have a little buffer for when interest rates increase and inflation hits.

If you are not stressing about bond repayments, you will have more time to enjoy your new home.

Get everything inspected

It might seem like another expense on top of an already costly process, but getting your dream home inspected by a professional home inspector will ensure that you don’t buy something that will be a money pit.

Having a licensed inspector investigate the property will uncover any problems with the foundation, pipes, electrical work, roof, or other high-priced items. If you opt out of an inspection, you run the risk of entering a home full of repairs — leading to a bout of buyer’s remorse.

Even if you are in the market for a fixer-upper, get it inspected. This way you can plan ahead for the renovations that you will need to do once you move in and it even might provide a little negotiation room with the seller if the property requires a little more renovations than you first expected.

Lists, lists, lists

While the old adage might be location, location, location, we believe in lists, lists, lists when it comes to avoiding buyer’s remorse. When buying a home, make sure you’ve got a list of your “must-haves” and “would be nice to have” features.

For instance, if you work from home, space for a home office might fall into the must-have category. Having an open-plan kitchen or a fireplace is more of a nice-to-have type of feature. You also need to keep your lifestyle needs and personal goals in mind when choosing your home – the happier you are in the neighbourhood, the more time you will want to spend exploring it and spending time at your home. Remember to have an honest conversation about where you are in your life and where you see yourself in the next five years. If your life is busy and full of traveling for work, then having a home with a huge garden will not be the right fit for you. The same goes for those looking to start a family – a city apartment is not ideal for kids and opting for a townhouse might be a better fit.

We know that finally calling yourself a home owner is such an incredible feeling, but making decisions too quickly or based on other people’s opinions will only lead to hating the space you are in. And who wants that? So if you are feeling hesitant, hold off and make your decision with a clear mind.

Original Article: https://www.myproperty.co.za/news/market-and-opinion/how-to-avoid-buyer-s-remorse-as-a-first-time-home-buyer-15-09-23

Categories
Blog

Demand for student accommodation a key driver in Stellenbosch’s buoyant residential developments market

Such is the surge in demand for student accommodation in the university town of Stellenbosch in the Cape Winelands, that investors – and parents – are snapping up units in sectional title developments designed to cater to this lucrative market.

According to Louise Varga, Pam Golding Properties area manager for Stellenbosch, Somerset West, Gordon’s Bay and Strand: “The accelerated demand for student accommodation has pushed up property prices, especially sectional title properties close to Stellenbosch University campus.

“This demand translates into meaningful capital returns on investment for astute buyers, particularly those who acquire units on or soon after launch.  For example, a buyer who purchased an apartment for R2.4 million in Beau Vie sold it for R2.8 million a year later, achieving a 17% capital return in just one year.

“In another instance, we sold an entire apartment block Beau Vie 2 off plan to an investor even before it came to market, as he understood and seized the opportunity to capitalise on the high demand for student accommodation in Stellenbosch.”

Continues Varga: “In 2015 a two-bedroom unit in Andringa Walk sold for R2.65 million and was rented out for R9 400 per month, while today, a two-bedroom unit in this development sells for over R4.7 million and achieves rentals of R24 500 a month. The capital growth achieved in eight years is almost 77% while the rental has increased by 160% over the same period, and even during Covid, rental demand continues to increase exponentially, exceeding supply.

“In 2010, we sold erven in the development, Brandwacht aan Rivier for R995 000 to buyers purchasing off plan, with some selling their erven three months after transfer for R1.495 million – that’s R500 000 or just over 50% more than they paid for them, which underscores the benefit of getting in early on these new developments.

“Furthermore,” says Varga, “a new development like Newinbosch, that offers a wide variety of homes and accommodation plus an endless list of amenities has sold over R200 million in residential property in just five months, on one estate.”

Student accommodation is among the fastest-growing property sectors globally, with a similar trend appearing evident in South Africa where the supply-demand gap for this asset class is widening. According to estimates by the World Bank’s International Finance Corporation, the shortage of student beds in SA will reach 780 000 by 2025. This makes an investment in accommodation close to universities such as Stellenbosch University, and educational institutions, a viable choice for those seeking strong net yields and solid capital growth.

Says Varga: “Over the years the student accommodation market has evolved with more amenities offered and security a firm priority. A new two-bedroom unit now includes two bathrooms and two parking bays, while developments are starting to cater for load shedding. At My Space, modern-designed apartments in three different venues – My Space@Drostdy, My Space@Dorpstreet and My Space@Paradys, there will be WiFi in all communal areas during loadshedding, while these blocks also include a number of social spaces, game rooms, gyms, private courtyards, special study spaces, a zoom room, deli, laundry, and braai.

“Taking into account the growing need for student accommodation, the local council has adopted the densification process, with new developments being renovations or rebuilds of older buildings. To illustrate, My Space@Drostdy was formerly the Drostdy retail space, Stellenbosch Lodge is now an apartment block called My Space@Paradys, and in developing The Niche, three adjacent houses were acquired, the erven consolidated and an apartment block constructed on the site.”

At present Pam Golding Properties is marketing units in 14 residential developments in Stellenbosch – comprising eight sectional title apartment blocks, all of which cater for students or young professionals – and five general residential developments.

At present, sectional title blocks catering for students only are: Da Vinci, Archimedes and Deo Gloria, while sectional title blocks for young professionals or student accommodation are: The Niche, My Space@Paradys, My Space@Drostdy, My Space@Dorpstreet and The Alxandr. Prices at these developments range from R1.75 million to R 5.45 million for loft, one-, two-, three, or four-bedroom apartments.

Other residential developments marketed by Pam Golding Properties in Stellenbosch include Welgegund Domaine Prive, Newinbosch, Longlands Estate, Oakview Estate, and Vini Fera at Anura, at a broad cross-section of prices ranging from R875 000 to approximately R13.69 million, depending on the development and whether you buy vacant land or a house.

Varga says that apart from local purchasers, Stellenbosch has in recent years experienced a marked increase in semigrating home buyers, prompted by good schools, exceptional service delivery, and an enviable lifestyle. Proudly a student town, it’s historical with an abundance of natural beauty, majestic mountains, world-class wine farms, and in relatively close proximity to Cape Town International Airport.

Adds Varga: “Approximately 47% of our buyers are locals in Stellenbosch, 24% from Gauteng and KwaZulu-Natal, 21% to surrounding towns in the Boland & Overberg and Western Cape in general, and the remaining 8% are purchasers from other provinces and international buyers. Upcountry buyers tend to rent for a year before they buy, which accounts for the high proportion of Stellenbosch buyers – who include savvy buy-to-let investors catering to the high rental demand while achieving wealth creation through astute property investment.

“In Newinbosch, located on 48ha at the northern entrance to Stellenbosch, and only 3km from the Stellenbosch CBD, the university, college, schools, hospitals, Technopark, and other business parks, buyers have access to a diverse variety of options across all price ranges. A total of 1 320 units across apartments, simplexes, townhouses, courtyard homes, and homesteads are complemented by a host of amenities including a retail centre, crèche, primary and high schools, church, clubhouse, eatery, gym, tennis courts, dog park, skateboard park, amphitheatre, urban farm, 25m swimming pool, children’s pool, cycling and running routes, cricket nets and children’s play areas among others.”

Original Article: https://www.myproperty.co.za/news/market-and-opinion/demand-for-student-accommodation-a-key-driver-in-stellenbosch-s-buoyant-residential-developments-market-06-09-23

Categories
Blog

How to build your credit score when you are broke

The early years of adulthood, often filled with excitement and newfound independence, can also be accompanied by financial struggles. As you navigate through your 20s and early 30s, expenses like your first car, apartment, and unexpected furniture costs can quickly add up. In the midst of these financial challenges, it’s essential not to overlook the importance of building a credit score. A solid credit score is your ticket to securing future financial opportunities, such as qualifying for a home loan.

In this article, we’ll explore expert advice on how to build your credit score even when you’re dealing with a tight budget.

Taking the Long-Term View

Building a good credit score is a gradual process that requires a long-term perspective. The financial strain that many young professionals experience during these years can’t be underestimated but while some life stages might involve relying more on credit, it’s crucial to consistently meet the minimum repayments on your various sources of debt. Over time, certain debts, like student loans and car loans, will be paid off, freeing up funds that can be used to reduce other debts and improve your credit score.

The Magic Number: Three Lines of Credit

Goslett recommends that individuals serious about boosting their credit score aim to have three lines of credit. This strategic number demonstrates to financial institutions that you can manage different types of credit responsibly. Having more than three lines might raise concerns that you’re overextending yourself, while fewer lines could result in a thin credit history. As you approach the point of applying for a home loan, it’s important to note that most credit checks consider the last six months of credit activity. To ensure the best possible credit score for your application, start reducing your debts at least six months before approaching financial institutions.

The Power of an Active Savings Account

While it might seem counterintuitive to focus on savings when you’re trying to manage existing debt, having an active savings account can significantly contribute to improving your credit score. Once you’ve made progress in lowering your debts, shift your attention to building up your savings. This not only increases your chances of securing a lower interest rate on your future home loan but also provides a safety net for unexpected costs associated with buying a property, such as transfer duties and registration fees.

Expert Insights for First-Time Buyers

For those taking their first steps into the real estate market, seek guidance from experienced real estate advisors. These professionals can offer invaluable insights into the realities of property purchasing. They can help you understand the costs involved, the price range that aligns with your search criteria, and an estimated timeline for finding your ideal home. This information provides a practical framework for organizing your finances effectively.

Ways to monitor your credit score

Staying on top of your credit score is crucial, especially when you’re navigating the path of financial recovery. It’s easy to feel overwhelmed in this process, but fortunately, there are numerous tools and resources that can aid you in monitoring your credit score.

Experian, Clearscore, and TransUnion are just three ways you can check your credit score and ensure that all the information on the report is correct. Remember, maintaining a good credit score is an ongoing process. Regular monitoring can help you understand how your financial decisions impact your score and provide insights into how you can improve it.

Original Article: https://www.myproperty.co.za/news/market-and-opinion/how-to-build-your-credit-score-when-you-are-broke-28-08-23

Categories
Blog

Rental growth hits highest level since 2017

Quarterly year-on-year rental growth continues to accelerate in South Africa, reaching its highest level since the final quarter of 2017. PayProp’s most recent Rental Index shows that rental growth reached 4.4% in both April and May, followed by 4.2% in June 2023. The average national rent figure now stands at R8 375.

PayProp’s head of data analytics, Johette Smuts, says that for the first time since before the COVID-19 pandemic, residential rental growth is approaching the rate of consumer price inflation. Interest rates may now have reached their peak following the South Africa Reserve Bank’s decision to hold them steady last month, and this places the rental industry on the brink of its first real-term gains in some time.

 

Growth returns in all provinces.

All provinces posted positive growth in Q2 with the majority falling within a percentage point of the 4.4% national average. South Africa’s wealthiest province, Gauteng, showed year-on-year rental growth of 4.5%, taking the average rent in the province to R8 691 in Q2. This is a particularly strong performance after a sluggish first quarter when Gauteng posted the second slowest rental growth at just 3.1%.

Moving south, the Western Cape remains South Africa’s most expensive province in which to rent despite a weaker performance in terms of growth this quarter. Average rents reached R9 730 in Q2 from R9 462 a year earlier, but year-on-year growth was just 2.8% – the second lowest in the country and well below the 5.0% set last quarter.

KwaZulu-Natal recorded 4.4% growth in the quarter, putting it right on the national average. However, this is a slowdown compared to Q1’s 5.0%. KZN remains South Africa’s third most expensive province in which to rent with an average monthly rent of R8 817.

In terms of rental pricing, Mpumalanga is South Africa’s most average province with tenants paying R8 281 this quarter. Rents in the province are less than R100 from the national average of R8 375 after a solid rental growth rate of 5.2% this quarter.

Rental growth in the Northern Cape slowed slightly from the blistering 10.2% in Q1 to 6.8% in Q2. The province experienced the biggest average rental increase in cash terms at R590 year-on-year, from R8 626 to R9 216.

Room for growth

While rents have gone up, data taken from credit checks on rental applicants shows that tenants’ incomes have comfortably outpaced rents across most income brackets – and even beaten inflation. Previously, analysts have warned that affordability pressures on tenants could stifle rental growth, but according to PayProp that hasn’t been the case so far despite a slight increase in arrears.

“With rents and incomes rising and inflation falling, Q2 brought good news for landlords, tenants and rental agents,” says Smuts.

“The residential rental sector has endured challenging conditions over the last few years and it’s encouraging to be able to report on sustained, positive rental growth.”

Original Article:https://www.myproperty.co.za/news/market-and-opinion/rental-growth-hits-highest-level-since-2017-25-08-23

Categories
Blog

How to secure high-paying tenants with standout rental properties

Homeowners in South Africa are under pressure despite the recent pause in interest rate hikes, leading to many homeowners selling up or renting out their homes and moving into smaller rental properties.

Property professionals reported rising demand for rental properties in the latest PayProp Rental Index (Q1 2023), with budget-sensitive consumers opting for a fixed rental payment over a fluctuating bond repayment. Even would-be home buyers are opting to stay in rentals, driving up demand.

Michelle Dickens, CEO at PayProp, says the after-effects of the COVID years are still being felt by South African consumers. “Homeowners and tenants alike are still in a state of recovery from the substantial economic impacts of the period, compounded by present-day economic challenges like the cost of food and fuel and continued load-shedding. As such, many are delaying buying homes or even returning to the rental market, boosting demand for rented properties.”

But while it’s easier to find a tenant, finding the right tenant is now more important than ever. Landlords are also facing higher bond repayments, giving them much less margin for error. If they are to stay profitable, they need to find tenants who will reliably pay the increased rents needed to cover their rising costs.

That means the challenge is for landlords and investors to differentiate their properties in order to attract quality tenants.

Dickens suggests simple improvements to glean maximum value from an investment property:

1. Energy security

With the current pressure on the South African grid, being able to keep the lights on is a substantial property differentiator. This doesn’t necessarily mean the installation of a full solar and inverter system (although at the top end of the market, solar panels are a key feature) but could be as simple as a stand-alone battery backup to keep the lights, wi-fi, and television operational during load-shedding.

2. Gas installation 

Load-shedding means electric appliances like the microwave, oven, and hob don’t work – often over meal times. Whilst we’re not able to solve it all, the simple installation of a gas hob means that tenants are able to prepare food whilst the power is off.

3. Security upgrades

Minor improvements in security measures add immediate value to a property. Simple additions, like a light-fitting CCTV camera that enables tenants to monitor movements within their property, make all the difference.

4. Remote geyser operation

By installing a smart wi-fi-connected geyser timer, tenants are able to switch their geyser on and off remotely. This enables power saving and also gives them a better insight into their energy consumption.

5. Administrative simplicity

Making use of platforms like the PayProp Tenant portal means that tenants can easily pay their rent online and have 24/7 access to their invoices and statements, keeping them informed and in control of their payments.

“Once you’ve raised the value of your property with a few simple and affordable steps, it’s equally important to screen your applicants carefully,” says Dickens. “Systems like PayProp’s Tenant Assessment Report make that easy, allowing rental agents to check an applicant’s credit score and past rental payment behaviour, which makes it easier to place tenants who can and will pay on time and in full.”

Original Article: https://www.myproperty.co.za/news/market-and-opinion/how-to-secure-high-paying-tenants-with-standout-rental-properties-24-07-23

Categories
Blog

What home owners should know before filing their tax return

Tax season is upon us and individual taxpayers have until 23 October 2023 to submit their returns. For landlords and for those who work from home, this presents an opportunity to claim back for certain expenses.

Regional Director and CEO of RE/MAX of Southern Africa, Adrian Goslett explains that while ordinary homeownership does not offer any tax benefits, owning a second home will affect an individual’s tax return. “Landlords are required to declare the total amount of rental income received as part of their taxable income. They can lower that taxable income by making certain deductions of non-capital expenses,” he explains.

Explaining what is meant by non-capital expenses, Goslett says that there are certain expenses that a landlord is obliged to incur when letting out a property. Examples of non-capital expenses include items such as:

  • Rates, taxes, and property levies
  • Security costs and garden services
  • Interest paid on the home loan
  • Advertising costs of marketing the property and / or the rental agent’s fees for securing a tenant
  • Insurance (only homeowner’s insurance, not household contents insurance)

Repairs in respect of the area let (not applicable if the tenant has moved out and repairs are made to the home to sell it)

By deducting these expenses, landlords can lower how max tax is owed by lowering their taxable income. “These expenses won’t automatically reflect on your return, so it is important to take the time to submit these when filing your return. Be sure to keep all receipts on file in case SARS ever asks for proof of the expenses,” he advises.

Another thing that won’t automatically be included on an individual’s tax return is the deduction for home office expenses (if it applies). Goslett notes that a tax-deduction can be made based on the interest charged on the outstanding bond amount if the individual is employed and a condition of the employment is to carry the cost of keeping a home office as the central business location.

It can be complicated to perform the necessary calculations for this deduction, especially if the homeowner withdraws an amount from the bond or makes a substantial additional payment towards the bond. Goslett recommends that homeowners consult with a professional tax consultant to help them work out this amount correctly.

“It is important to work out any tax deductibles correctly, as there could be serious penalties if the return is submitted incorrectly. If there is ever any area of doubt, it is best to consult with a professional financial adviser or tax consultant who can provide assistance and guidance through the process,” Goslett concludes.

Original Article: https://www.myproperty.co.za/news/market-and-opinion/what-home-owners-should-know-before-filing-their-tax-return-02-08-23

Categories
Blog

Understanding how interest rates impact your home loan

When it comes to purchasing a home, most South Africans rely on home loans to fulfill their dreams of homeownership. However, obtaining a home loan is not just about the principal amount and monthly repayments. One crucial factor that significantly influences the overall cost of your mortgage is the interest rate. In this article, we will delve into how home loan interest works and the direct impact of interest rates on your mortgage.

How does home loan interest work?

In South Africa, home loan interest rates are determined by the South African Reserve Bank (SARB) through its Monetary Policy Committee. These rates are influenced by various economic factors such as inflation, economic growth, and global market conditions. Generally, home loan interest rates in the country are fixed for a certain period (usually one to five years) or can be variable, fluctuating with the prime lending rate.

The prime lending rate is the benchmark interest rate used by banks to determine the interest rates they offer to consumers. It is influenced by the SARB’s repo rate, which is the rate at which the central bank lends money to commercial banks. When the repo rate changes, the prime lending rate and consequently, the home loan interest rates, are adjusted accordingly.

How will the interest rate affect my mortgage?

The interest rate you secure for your home loan will have a significant impact on the total amount you repay over the loan term. A lower interest rate means lower monthly repayments and less interest paid overall, making homeownership more affordable. Conversely, a higher interest rate translates to higher monthly installments and increased interest costs, potentially stretching your budget.

For instance, let’s consider two home loans – one with an interest rate of 8% and the other with 10%, both with a 20-year repayment term. The difference in the monthly repayments between these two loans can be substantial, and the total interest paid over the years will be significantly higher with the 10% interest rate.

It’s crucial to compare different lenders and loan options to secure the most favorable interest rate for your home loan, as even a slight difference can have a substantial impact on your finances in the long run.

What happens to loans when interest rates rise?

Interest rates are subject to fluctuations, and when they rise, they can have significant implications for borrowers. If you have a fixed-rate home loan, your interest rate remains unchanged during the fixed period, providing you with stability and predictability. However, if you have a variable-rate home loan, your interest rate will be directly affected by any changes in the prime lending rate. This also means that when interest rates go down you are missing out on the savings of a lower monthly repayment.

When interest rates rise, your monthly mortgage payments will increase, and you may need to readjust your budget to accommodate the higher costs. For some homeowners, this can lead to financial strain and potential difficulties in meeting their monthly repayments.

Original Article: https://www.myproperty.co.za/news/market-and-opinion/understanding-how-interest-rates-impact-your-home-loan-20-07-23

Categories
Blog

No slow-down in semigration to the Cape despite higher interest rates

The demand from semigration buyers for property across the Cape continues at pace and it is unlikely that semigration to the Cape will lose steam, says Samuel Seeff, chairman of the Seeff Property Group. It may slow down, but only due to buyers being hamstrung by an inability to sell their houses elsewhere in the country.

Seeff assesses that the Cape metro will increasingly be seen as a new hub for head offices, and services including technology, with Amazon, Take A Lot, and the like.

Semigration may in fact pick up further due to the deterioration of service delivery in many municipalities. The desire to move to the Cape is also driven by a search for a better quality of life, he adds. Ross Levin, licensee for Seeff Atlantic Seaboard and City Bowl, for example, says that there is a strong influx of semigration buyers to the coastal suburbs.

While these buyers were traditionally from the Gauteng and inland areas, they are now also coming from the KZN region. Levin says high end buyers see the Cape as a rising hub, and they are investing. We are also seeing a stream of businesses moving to the city. A recent FNB report also reported that the commercial property sector in the City is doing better compared to most other areas with semigration being a boost for property development.

There is no decline in prices here, in fact, Seeff’s agents continue seeing a shortage of stock in many price bands, especially in the R3m to R18m range. The Cape has seen a massive bounce back in tourism and a welcome return in international buyers.

Looking at the sales statistics in Cape Town for this year, there have already been 51 sales above R20 million with a combined value of R1,767 billion. International buyers have also invested heavily in property during the first few months of this year, says Levin.

This includes Russian and European buyers (especially from Germany, the UK, Netherlands, etc.) who are looking for alternative markets to invest in while the Russian-Ukraine War continues.

Everybody now wants to be in Cape Town, and if you are a seller, then Cape Town is where you want to be selling right now. If you are a buyer, then Cape Town is where you want to invest right now, says Levin further.

Nadine Jocum, an agent with the Seeff Camps Bay team says there has been an increase in demand for property in Camps Bay, especially above R5 million, but also in the luxury bands for houses and apartments up to R11 million and over R20 million.

Adrian Mauerberger and Bryan Ginsburg, luxury sectional title agents with Seeff Atlantic Seaboard say that luxury apartments are in high demand, especially in the R4,5 million to R8 million price bands, but buyers have paid up to R72 million for a super luxury beach apartment over the last year.

It is also not just sales, but the rentals market is also exceptionally strong in Cape Town, boosted by inward demand, says Seeff further. Aside from the Atlantic Seaboard, the Blouberg, False Bay and Southern Suburbs are popular along with the Northern Suburbs and further out to the Winelands towns of Paarl, Stellenbosch and Somerset West.

Seeff also says, we continue seeing high end buyers spend notably more on property in Cape Town compared to elsewhere in the country. We are for example seeing higher prices paid in areas such as Stellenbosch and Hermanus seeing more high value sales as well as Paarl (mostly in Val de Vie) along with Plettenberg Bay where we are increasingly seeing property sales above R20 million.

While many areas in Cape Town are pricey, there are many areas which are still affordable and offer housing below R1.8 million. These areas such as the greater Milnerton/Blouberg area for example have seen significant semigration related sales and rentals.

Property values in the Cape have grown significantly faster and at a higher rate compared to the rest of the country. People move to Cape Town not because of the cost of property, but specifically for access to better services, but also a change of lifestyle – these two factors seemingly going hand-in-hand for many buyers.

Original Article: https://www.myproperty.co.za/news/market-and-opinion/no-slow-down-in-semigration-to-the-cape-despite-higher-interest-rates-13-07-23

Categories
Blog

How to find the best value homes in South Africa

The current state of the economy has many searching for cheaper alternatives on just about everything. While the demand for affordable housing remains high, affordability will mean something different for everyone.

“The word ‘cheap’ is relative. One man’s cheap is another man’s expensive,” says Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa. “A better phrase is ‘Where is the best value?’ – and that in itself is a complex question because we all have such different needs,” he notes.

According to Goslett, the approach buyers should take when looking for a property should be to identify where they want to be and why they want to be there. “Next, determine what it is you want from the property. Once you’ve established that, have a qualified estate agent do a comparative market analysis for you of the types of homes you are looking for. That way you can benchmark ‘your ideal home’ against what the market is currently offering and determine for yourself whether the investment is ‘cheap’ in relation to the value you will derive from the investment,” he explains.

There are a few ways to work out how the price of a home compares to others. As mentioned above, having your agent prepare a report comparing homes with similar features within a given suburb is one of the most accurate ways to determine if the home is offering good value for money.

Another way is to consider average house prices in your province. According to the RE/MAX National Housing Report for Q1 2023, the Free State has the lowest median asking price per province. The North West Province follows behind closely at just R1,295,000. According to Adéle Cillié, Broker/Owner of RE/MAX Legacy, average housing prices in Potchefstroom have remained fairly constant at around R1 million. This is far below the average in SA’s most expensive province, the Western Cape, where the median asking price is at R2,550,000.

The RE/MAX National Housing Report also reveals that sectional title homes tend to cost less than Freehold properties, with the average price sitting at R1,331,685 for freehold properties and at R1,115,509 for sectional title homes.

However, it is important not only to focus on where you can find a home with the lowest possible purchase price, but also to consider the area’s potential for future profit. “You make your profit when you buy the property, not when you sell,” says Goslett.

In addition to this, Goslett explains that if the value of your property increases because of the area’s characteristics and market conditions, you can reasonably expect that other homes in the same area would have appreciated by a similar percentage. “Therefore, while your home has appreciated, should you wish to sell your home and purchase another home in the same area, the net gain is negligible,” he notes.

“The time to make your money is when you buy. Researching the area, the houses on the market and staying close to a good real estate agent will get you some of the way there to negotiating the best deal at purchase. It is then also up to you in how you decide to either maintain or upgrade the home to add value,” he concludes.

Original Article: https://www.myproperty.co.za/news/market-and-opinion/how-to-find-the-best-value-homes-in-south-africa-14-07-23

BOOK YOUR FREE APPRAISAL
FFH-logo-HORIZ-1
Social Media
Facebook-f Instagram Linkedin-in

COPYRIGHT 2022 FLAT FEE HOMES | ALL RIGHTS RESERVED