Cape Town’s southern suburbs are thriving as people who semigrate look for high quality affordable housing in the Mother City.
International buyers are also investing in these suburbs as opposed to in luxury properties on the Atlantic Seaboard, Francois Venter, a luxury property expert with Seeff Southern Suburbs said.
For the upper end of the market which includes Bishopscourt, Constantia Upper, Newlands, Claremont, and Kenilworth Upper, last year was a property boom. In Constantia Upper alone, property sales amounted to about R1.5bn.
Sales above R20m in Bishopscourt and Constantia Upper reached a record 19 deals last year.
In Bishopscourt for example, real estate group Seeff concluded a R39m sale to a UK buyer. House prices now range upwards of R25m in the suburb, while the average selling price for the first quarter is around R27m.
In both Constantia Upper and Bishopscourt, buyers are around 50/50 South African versus international, mostly from the UK and Germany with most recent sales being international buyers. Some are “swallow” buyers looking to spend six months of the year in SA, while others such as a UK buyer who spent R27m on a home in Constantia Upper will be relocating to the Cape.
The Constantia Upper property market ended last year with a record 108 sales and a record R1.5bn in value. This year is also off to a good start, said Venter. The average selling price for Constantia Upper in the first quarter was R14.5m.
While around 75% of the market falls below the R15m price range, there is more demand at the top end of the market above R20m, driven primarily by international buyers. Sellers achieved on average around 8.7% below their asking prices in the first quarter.
Newlands is popular with families with the R6m to R7m range being the most active. Properties are spending around three months on the market on average and sellers achieved about 7.8% on average below their asking prices in the first quarter.
Although sellers are potentially getting closer to their asking prices, Venter said correct pricing remained vital.
“Regardless of whether the property is in the R2m or R20m range, it will sell faster if priced correctly, Venter says.
Cape Town offers the combination of lifestyle and investment value with the Southern Suburbs “Uppers” being primary areas. Aside from amenities, schools and the University of Cape Town, SA’s oldest wine farms, Buitenverwachting and Groot Constantia are on the doorstep of these suburbs.
“A renewed focus on lifestyle and particularly quality living has bolstered demand and the outlook remains strong. Prices have remained fairly flat with subdued growth of around 3% to 4% in nominal terms which means it is a fantastic time to buy,” said Venter.