April 16 2024 18:00
Landsdowne Properties, a residential real estate manager and estate agency says semigration to the Western Cape remains strong as people search for quieter lifestyles.
The group continues to see increased sales and rentals in the Western Cape compared to other regions as many households in provinces like Gauteng and KwaZulu-Natal sell their properties to move to the Western Cape.
Jonathan Kohler, founder, and CEO of Landsdowne said: “Semigration remains one of the key drivers in the Western Cape property market. Increasingly, more people, and businesses move to the region as it is perceived to have better run municipalities, have reduced load-shedding stages, and offer unrivalled lifestyles away from the hustle and bustle of Gauteng for example.”
Semigration – the movement of people from one province or city to another has been a trend even before the Covid-19 pandemic in 2020. With flexible working models enabling people to work from anywhere, many people saw this as an opportunity to move to other areas.
Data from Lightstone shows that the Western Cape continues to benefit from semigration as ratepayers seek better-governed municipalities with good infrastructure, governance, and unrivalled lifestyles. During 2019 and 2023, sales of properties priced between R100 000 and R20 million rose from 23% to 27%, while Gauteng saw sales fall from 43% to 29%. The Western Cape also recorded the highest increase in sales activity in smaller towns compared to Gauteng and KwaZulu-Natal.
Landsdowne is a sales and rental agency with over 35 000 apartments and freestanding clusters under management. As demand for property increases, the group reported successful property sales in areas including Blouberg, Sandown, Parklands, Parkland Norths and Sunningdale.
Kohler said these areas attract buyers and investors due to the lifestyle offering with sandy beaches, spectacular views of Table Mountain, good infrastructure, various amenities including schools, hospitals and medical facilities, entertainment, and shopping centres.
In these suburbs, the group has sold one-bedroom apartments priced from R795 000 in Cape Town and achieved up to R3.195m for three-bedroom family homes in Sunningdale. Some of the properties have a cottage or flatlet for additional income.
Kohler said that it’s currently a buyers’ market and savvy purchasers and investors are snapping up properties that are priced in line with market conditions. Though interest rates are still high and keeping many potential buyers out of the market – those buying in the Western Cape are now getting better value for money.
He said the price a seller achieves in Gauteng may not necessarily be enough to buy the same house in the Western Cape. However, when the market improves, the Western Cape will likely recover more quickly than Gauteng.
Kohler said high interest rates have benefitted the buy-to-let market. Demand for rental properties is high as many people cannot afford to buy property now. In some instances, this has resulted in rental growth, especially in the Western Cape where demand exceeds available supply.
According to the PayProp Rental Index for the fourth quarter of 2023, the Western Cape recorded year-on-year rental growth of 3.9%. Average rentals reached R10 118 – a R382 increase from 2022 – making the Western Cape the most expensive province to rent property. Tenant risk is also low with more than half of applicants falling within the minimum-risk bracket compared to 37.7% nationally.
Kohler said one-bedroom apartments in Cape Town make for a great investment with net rental yields of about 10.8%.
247@propertyflash.co.za
