Mouille Point Peninsula defies market trends with record sales

Aerial view of the Mouille Point Peninsula, which has achieved record sales during the past two years.

Despite a broad slowdown in South Africa’s housing market, the apartment sector on the Atlantic seaboard appears to be impervious to the economic factors influencing trends in other areas and this is especially evident in the Mouille Point Peninsula, which has achieved record sales during the past two years.

Comprising the canals and the front yacht basin, in 2014 the sought-after marina in the V&A Waterfront enjoyed its best year since 2007 with 219 units sold to the value of R661 million, according to Ross Levin, City, Atlantic and Western Seaboard operations and development manager for Lew Geffen Sotheby’s International Realty.

“The marina has achieved a combined year-on-year price escalation of 361 percent since the beginning of 2000 to date, with the canals recording an appreciation of 303 percent and the front yacht basin a whopping 469 percent during this period,” says Levin.

“This translates to a substantial annual escalation of 20 percent for the canals and 31 percent for the front yacht basin, which is excellent news for long term investors.”

Citing Lightstone figures, Levin says this phenomenal growth is also clearly depicted by the steady increase in the rand a square metre price of properties in the marina.

“During 2000 the average price on the Canals was R13 900/m², jumping to R44 386/m² in the boom year of 2007 and sailing through the credit crunch to a solid R56 063/m² by the end of the first half of 2015.

“The front yacht basin started off at an equal footing in 2000 with an average of R13 724/m², but by June 2015 the median had increased to R78 136/m², with a significant 34 percent price difference placing this prime waterfront property in a class of its own.”

Levin says the V&A Marina continues to experience remarkable growth, with 2015 being one of the most successful in the development’s history. It will always offer investors an excellent return on investment because of its prime location and limited investment opportunities.”

Agent Mikaela Pace says although stock levels are currently low, demand remains high and the market continues to buck the current economic downturn.

“We recently sold a luxurious unit in Altmore on the water’s edge of the canal for R6.35m, which realised a 50 percent increase in the sale value in just 24 months.”

Levin says the recent shift in the investor demographic from a large foreign buying market to a predominantly South African investor base is an excellent indicator of investor confidence in the precinct as well as the city.

However, not all markets are equal and, while the V&A Waterfront residential market has enjoyed a steady growth in demand and return on investment for 15 years, its neighbour has been a late but efflorescent bloomer.

Pace says: “Mouille Point and the V&A Marina have always enjoyed a close relationship, but until a few years ago the market of the hitherto unremarkable and often overlooked suburb fell far short of the Waterfront residential precinct’s stellar rise.

“But the construction of the Cape Town Stadium for the 2010 Soccer World Cup and the development of the Green Point Urban Park have stimulated residential development and regeneration in the area, which has elevated Mouille Point’s status and placed it squarely in the glittering Atlantic seaboard limelight.”

Now referred to as the platinum mile, the property landscape in Mouille Point comprises 34 apartment blocks, most of which have spectacular sea and mountain views. Many are older blocks that have been upgraded and renovated and several are newly built, offering buyers modern and luxurious lifestyles with unsurpassed views as well as convenient proximity to the CBD, Atlantic seaboard beaches and the Waterfront.

Says Levin: “The exponential growth in the area has resulted in sales volumes and rand values surging in just a few years. A very sluggish market improved notably in 2010 when 97 apartments changed hands for a total value of R323m, with the average price being R3.3m.

“After the World Cup, the growth ebbed a little but in 2014 the market really came into its own when sales again breached the R300m mark with 83 sales worth R315m. And with the average price currently at R5.98m, it shows a very healthy 16 percent year on year increase over five years since 2010.”

Pace says the latest completed apartment block, Amalfi, has raised the bar for property value in Mouille Point.

“The 469m² penthouse was sold for R78m or R168 076/m², with the second highest price for the suburb being achieved in the same building with a 187m² apartment realising R136 364/m².”

No longer a drab suburb en route to the Waterfront, Mouille Point now has many top class eateries and the seafront has become a popular extension of the Sea Point Promenade that attracts walkers, cyclists and dog lovers to the lawns and paths that hug the coastline, as does the inviting green space that is the new Urban Park.

“Another notable change in the market is the foreign buyer demographic,” says Pace.

“Last year around 85 percent of the buyers in Mouille Point were South African and predominantly from Gauteng, with most of the remaining investors from Europe. This year the local percentage has remained much the same but the foreign investors are now mostly from other African countries.”

Sales in Mouille Point have continued to increase during the course of 2015 and Levin predicts that 2016 is going to be an extremely exciting year for the flourishing suburb.

Comfortably nestled between the V&A Waterfront and Mouille Point is The Water Club in Granger Bay, a calm inlet next to the Waterfront which for decades served only as a launching facility for small fishing boats and pleasure craft with a rudimentary clubhouse being the only building.

Now home to the niche 24 hour manned harbour development which consists of six apartment blocks, residents have direct access to the sea as well the amenities of the Radisson Blu Hotel.

Levin says: “Because The Water Club is not in the heart of the Waterfront, it is often overlooked by investors but in spite of this it has quietly been standing its ground as discerning buyers have recognised its value.

“Top prices were achieved twice during the last quarter of 2014 when two units were sold in Calais and Biscay for R10.15m (147/m²) and R10.83m (128/m²) respectively, which reflects a solid growth of 13 percent a year over a seven year period.”

Lew Geffen, chairman of Lew Geffen Sotheby’s International Realty, says that accessibility to top class amenities, a conveniently central location and luxurious accommodation in a secure environment will ensure continual strong demand for apartments on this prestigious strip.

“The Mouille Point Peninsula is no longer the poor relation on the Atlantic seaboard and the precinct made a significant contribution to 2014 being an all-time record year for apartment sales when 1 184 units were sold for a combined R3.66 billion. This is a solid 24 percent increase in value on the previous record year in 2007when 1 365 units worth R2.95bn were sold.”

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