With South Africa arguably being the most developed and sophisticated of our continent’s countries and Johannesburg seen as the business capital of our nation, with Sandton acknowledged as the richest square mile in Africa, it may be surprising to note that 9 out of 10 richest SA suburbs are in Cape Town, with the average price topping R15m. These were the findings of a study done by Seeff, based on data from Lightstone and Propstats for the period 2011/2 to 2016/7, explained Samuel Seeff, chairman of the Seeff Property Group, in July 2017.
Ranking in the top 10 Knight Frank Prime Global Cities Index along with the top cities in the world for the best luxury house price growth, Cape Town ostensibly has it all – between mountain and sea, Blue Flag beaches, trendy leisure and food precincts, and wine farms.
The top 10 rank as: Clifton (R23m), Llandudno (R17m), Bantry Bay (R16,9m), Sandhurst (R16,5m), Camps Bay (R16,2m), Fresnaye (R16m), Waterfront (R16m), Higgovale (R16m), Bishopscourt (R15,1m) and Constantia Upper (R11,6m).
The majority of the areas are along the Atlantic Seaboard and City Bowl, the best performing property market in the country with growth of 100% (double) over the last 5yrs years and 600% over 15yrs, still showing positive growth in hard currency terms – allowing for the fluctuating exchange rate of the Rand. The biggest gains have been in Fresnaye (+167%) and Camps Bay (+128%) over the five year period.
But despite the backdrop of junk status and overnight cabinet reshuffles with the slight of hand of David Blaine, South Africa refuses to take any depressing news lying down, a hallmark of resilience borne out during the boycott and apartheid era.
“Cape Town fights harder than the other provinces against corruption and service delivery, and perhaps this is the reason that there’s buoyancy in the property market,” explains Ian Slot, Managing Director of Seeff Atlantic Seaboard and City Bowl.
“The rental market, especially for residential/corporate rentals also remains strong, especially in the more accessible price ranges – this means that you should focus on investing the right type of property, area and price range if you want to ensure you are making a good rental investment. Land sizes are generally smaller in the Cape, as are the houses, especially when you look at the Atlantic Seaboard,” he adds.
But it’s no longer all about the sea and sand. A rapid turnaround over the last decade has seen the city centre transformed. Bree, Long, Loop and Kloof Streets are now recognised as hotspots, spilling over with restaurants, coffee shops, bars, boutiques and clubs, making a short walk, Uber, or use of the MyCiti transport network a more obvious choice than buying a car.
Just a few months ago, new development Tuynhuys on 54 Keerom Street, and designed by urban regeneration master architect Robert Silke, sold out 45 apartments in less than a few months off-plan, with construction set to commence in 2017 only.
Tuynhuys developer Brent Wiltshire from Willbridge Property Company explains, “Cape Town has boomed from the suburbs and seaboard and crept slowly inbound over the course of the last decade to the point that the city is now a central focus of the current property spike, fortunately intersecting with the generational trend to living closer to others, connecting with a vibrant energy and community, and releasing the need for unnecessary material burdens that are costly in both time and money.”
The CCID (Cape Town Central Improvement District), a private/public partnership that looks after the cleaning and security of the inner city, has been highly successful, turning the CBD into a trendy urban and downtown area similar to that of other world-renowned cities.
Even out of town areas in need of redevelopment are starting to see a facelift – with a house in the formerly struggling area of Woodstock making front page news by fetching R2.5m, with houses off Roodebloem Road now priced above R5m.
While price growth may not be as rampant as previous years, prices are holding firm at present, and a budding migration out of the city to the suburbs is unearthing new nodes of excellent value. Willbridge’s next development The Edge, set in Lagoon Beach – “edge of the city, edge of the sea” – will go on sale in February 2018 with studios starting at R1.3m. “As prices continue to boom in the city, there are a few hidden gems just outside the city – offering singles, couples and young families a little more space, the ocean, stylish design, and an easy commute to work at an accessible price point,” Wiltshire says.
Slot confirms, “There is high demand for sectional title property, investments, and those that offer the convenience of lock-up-and-go and low maintenance. And if you’re an investment buyer, the big trend now is “semigration”, a high demand for property in Cape Town from all over the country, but the key remains location, location, location. And an excellent agent, of course.”