select
|

Consumers’ property needs are evolving

The property needs in South Africa are evolving as more and more people move into urban areas, says Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa. He notes that in 1960 around 46.6% of the population lived in urban areas, however, that figure has changed dramatically with around two-thirds of the South African population now living in metropolitan hubs.

“According to a survey released by the South African Institute of Race Relations, the proportion of people living in urban areas increased from 52% in 1990 to 62% in 2011. The share of those living in rural areas dropped from 48% to 38% over the same period. Urban living surpassed rural living in South Africa in 2009. Currently, South Africa has a higher urbanization rate than the world average and it is expected to continue increasing at a rapid rate. As a result density, scarcity and re-urbanisation will be the key long-term themes in the property market for some time, as the current stock does not support the growing demand for urban property,” says Goslett.

There are two major causes that have brought about the trend; one being that people in post-apartheid South Africa have more freedom to move around, and the other is that there is higher economic growth within metropolitan areas. “People are drawn to urban areas because there are greater employment opportunities. Urbanisation has created a concentration of economic activity, which is alluring to people who need jobs. The largest percentage of growth in urban areas has been in the smaller cities, this is mostly because of these areas having a small initial population, increasing economic activity and less competition,” says Goslett.

He notes the urbanisation is not a trend that is unique to South Africa.  Globally, around 54% of the world’s population currently lives in urban areas, which is around 3.9 billion people. It is estimated that this will grow to around 66% by 2050, which is in the region of 6.4 billion people. It is expected that as a continent Africa’s rate of urbanisation will overtake Asia’s by the year 2030.

“Currently the property stock in South Africa is mostly full title homes, with this type of property accounting for 82.7% of the current market stock. Sectional title homes represent around 12% of the property stock, while estates make up the remaining 5%. As the population continues to push into urban areas and land becomes more and more scarce, it is likely that there will be far fewer full title homes being built,” says Goslett.

According to statistics from ABSA bank, in the last 20 years, flats and townhouses have made up 26.6% of newly completed buildings. In the last three years, around 36% of all residential development units financed by ABSA, were sectional title units. “Sectional title homes are in great demand due to a few reasons, such as financial pressure on consumers, inadequacy of land and a changing demand for lifestyle. It has been said that full title properties may well become an impractical and outdated luxury for most South Africans,” says Goslett.

He concludes by saying that the changing property needs within the country are no longer merely a trend they are a reality. People are migrating to suburban inner-city areas where they can live, work and play, eat and shop. This not merely because it is the place to be, but rather because of the convenience and lifestyle urban living provides.



  Comment on this Article

  Please login to post comments

Post to my facebook wall
  
2000
Characters remaining


    Latest Property News
    • 19 Jan 2018
      Extending from Randfontein in the west to Roodepoort in the east and including the towns of Krugersdorp and Magaliesburg, the West Rand has a plethora of property available to residents who choose to make this unique area their home.
    • 19 Jan 2018
      When it comes to financial planning, doing the work to ensure you’re prepared for unexpected emergencies is just as important as ticking off your other goals and New Year’s resolutions. The beginning of the year is also the perfect time to review your various insurance policies.
    • 19 Jan 2018
      No surprises at the first Monetary Policy Committee of 2018, as Reserve Bank Governor, Lesetja Kganyago, announced that the interest rates would stay at their current levels.
    • 18 Jan 2018
      The Southern Suburbs make up some of the most popular residential areas in Cape Town, comprising charming groups of suburbs which lie to the south-east of the slopes of Table Mountain. It is seen as the city's most expensive residential neighbourhoods with a choice of various private schools, upmarket eateries, wine estates, beautiful homes and trendy apartments.
    • 18 Jan 2018
      New year, new goals! If you’ve resolved to purchase your first property in 2018, then this 6-step guide from the Rawson Property Group is a must-read. It will help you navigate and simplify what is often be seen as a confusing process of buying your first home – right from the house-hunt to the house-warming.
    • 17 Jan 2018
      While the current property market may still favour buyers, it doesn’t mean that they shouldn’t be well prepared before putting in an offer to purchase.
    • 17 Jan 2018
      Lightstone lists Blair Atholl as the most expensive suburb with an average house price of R11.2 million, followed by Westcliff (R10.5 million), Dunkeld (R9.3 million), Sandhurst (R9.1 million) and Inanda (R7.2 million).
    • 17 Jan 2018
      As it currently stands, there are four main ways in which a home can be bought in South Africa, says Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa, who adds that deciding in which legal entity to purchase the property is not a decision that should be entered into lightly, as each has its pros and cons.
        
    X
    Subscribe to the MyProperty Newsletter

    Name  
    Last Name  
    Email Address  
    Email Frequency
    select
    X
    Share this Page

       
    For Sale Property
    Rental Property
    More Options
    About
    Connect with us
    FEEDBACK