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New units selling like hotcakes in Port Elizabeth

A shortage of homes for sale in the beachfront area of Port Elizabeth is driving strong sales of units in new developments.
 
So says Nikki Strooh of leading local agency Harcourts Beachfront, who reports that her team recently signed up off-plan buyers for almost all 24 townhouses in phase three of the Humewood Villas development within two months. "The units sold at prices from R775 000 to R875 000, a price range currently in very high demand in the beachfront area, especially among young buyers and investors."


This modernised character home in Summerstrand was recently sold by Harcourts Beachfront for R3m. Situated close to the beach, schools and shops, it features four reception rooms, five bedrooms, three bathrooms, a gourmet kitchen, pool, double garage and separate cottage.
 
One of the team’s sales consultants, Denise Gillan, adds that development in the city has been stagnant for the past few years and that the new development – and the fact that there has been such interest  - is a clear indication that there is pent-up demand and that general market conditions are improving. "We are now also starting to see multiple offers on properties for sale."
 
Gillansays investors are now also returning to the local market thanks to increased demand for rental units, and competing with first-time buyers in the R330 000 to R550 000 price range. Studio apartments at prices from R320 000 are particularly popular as investment buys because of strong rental demand among students at the university in Summerstrand. Parents of students are also active in this segment.
 
“Stock shortages have, however, led to investors targeting any property under the R1,4m mark, and as a consequence stock in this range is also becoming more difficult to source.” She adds that the current demand may lead to price growth because more new development to address demand is unlikely due to a dearth of development land in popular beachfront suburbs such as Humewood, Summerstrand andWalmer.”
 
At the same time, Strooh cautions, local sellers should be wary of inflated price estimates being made by agents keen to secure sole mandates. "We have noticed that that this practice is again rearing its head locally, and sellers should note that even though there is a stock crunch, wildly inflated prices will not attract serious buyers and will cost them valuable marketing time.
 
"They should insist on detailed marketing plans as well as a proper comparative market analysis based on data from the Deeds Office before awarding any sales mandate and especially a sole mandate," she says.


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