Mouille Point drives growth in entry level property sales

Investors and first time buyers eager to acquire an apartment in Cape Town’s Atlantic Seaboard are advised to move fast, as traditional entry level suburbs have shown huge price increases over the last year.

The average price of a Mouille Point sectional title unit has rocketed by nearly 70% in one year (average unit R1,8m in 2014, just over R3m in 2015) says Pam Golding Properties Atlantic Seaboard area specialist Basil Moraitis.

3 Bedroom House for sale in Mouille Point, Cape Town

“Mouille Point is the Cinderella story of the Atlantic Seaboard; and that phenomenal growth is also pushing up the Sea Point market.”

Sectional title units comprised over 90% of Sea Point sales in 2015 (289 by mid-November 2015). This growing interest has underpinned a 23% price increase on 2014, and 162% over the past 10 years. Green Point sectional title units have increased from an average R1,4million in 2014 to just over R2million.

Buyers are attracted by an inherently valuable seafront address, proximity to the CBD, V&A Waterfront, clubs and restaurants, the Green Point urban park, Cape Town Stadium and sports fields.

Several trends should underpin the longer term appeal and performance of such sectional title properties, says Pam Golding Properties analyst Sandra Gordon:

First-time buyers: First-time buyers (who opt for section title more than freehold) are a growing presence in the housing market.  The percentage of first-time buyers applying for mortgages with ooba rose from just 40% in late-2007 (earliest available data), to a high of 54% in late-2014;

Live, work, play: Younger buyers opt to live in smaller, more conveniently-located properties – often in metro hubs – to avoid traffic congestion and to enjoy city living amenities;

Densification: The shortage of available land in metro areas, and municipal legislation, encourage densification;

Affordability: Household maintenance costs such as electricity, rates and security are rising steadily. The deterioration in overall affordability is increasing demand for smaller sectional title properties;

Buy-to-let demand: While 13% of all properties sales (via ooba) were for investment/buy-to-let in late-2007 – ahead of the recession – this slumped to a low of 3.3% in early-2012. There has been a very marginal increase in buy-to-let purchases in recent years (4.9% of total mortgage applications received by ooba in September 2015). These purchases often favour sectional title properties over freehold properties; and

Youth bulge: South Africa has a young population, which is increasingly relocating to the urban areas. As a result, SA’s metros are becoming larger and younger. Within the next 10 years, this youth bulge will underpin demand for sectional title properties.

Moraitis said developers were accordingly considering the feasibility of any freestanding Green Point or Sea Point house, with a generous zoning allowance, to build two or more units.

“Properties coming onto the market, offering good value, can be snapped up in a very short time. It’s advisable to discuss your requirements and leave your contact details with reputable agents. This will help ensure you are aware of what is currently available, plus any developments in the pipeline.”

  Comment on this Article

  Please login to post comments

Post to my facebook wall
Characters remaining

    Latest Property News
    • 19 Feb 2018
      Possibly one of the biggest sources of contention between landlords and tenants surrounds the rental deposit. “Most tenants rely on getting their rental deposits back when moving, so that they can use it to pay a deposit on their new home. Having it withheld or even having large amounts deducted can lead to a lot of distress,” explains Bruce Swain, CEO of Leapfrog Property Group.
    • 19 Feb 2018
      Situated approximately halfway between Johannesburg and Pretoria, Midrand was established in 1981 and forms part of the City of Johannesburg Metropolitan Municipality. It has become one of the major business hubs in the country with major pharmaceutical, textile, telecommunication and motoring giants situated within its boundaries.
    • 19 Feb 2018
      The PayProp Rental Index Annual Review of 2017 shows that the rental market suffered from much volatility during the year. It kicked off with rental growth spiking in January with weighted year-on-year growth (YoY) growth peaking at 8.3% before dropping to 6.34% in July, dipping down to less than 5% in November and then experiencing a slight uptick at 5.75% in December.
    • 19 Feb 2018
      While most homes in cluster complexes, estates and other gated communities come with at least one garage or carport, residents would often like additional permanent parking or storage areas for things like trailers, bikes, boats and caravans.
    • 16 Feb 2018
      Whether you own a property in a sectional title complex or are looking to invest in one, the financial standing of the body corporate is the single most important thing that can affect your investment or your buying decision.
    • 15 Feb 2018
      One positive consequence of the financial crash in 2008 was the rise in consumerism, especially in the property market, where buyers have steadily become more knowledgeable and more value conscious.
    • 15 Feb 2018
      While most homeowners will take the agent’s commission into consideration when they are trying to determine what the will get out from the sale of their property, many often forget to factor in the other costs involved in a home sale, says Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa.
    • 14 Feb 2018
      The forecast for the national rental market in 2018 remains a mixed bag of good news and bad news. Although rentals are expected to rise slowly as the challenges of home affordability and tighter lending criteria tighten their grip, it’s a double-edged sword as the market also will come under increasing pressure from factors like declining disposable income levels.
    Subscribe to the MyProperty Newsletter

    Last Name  
    Email Address  
    Email Frequency
    Share this Page

    For Sale Property
    Rental Property
    More Options
    Connect with us