Amid the worst property trading conditions experienced in South Africa since the interest rate crisis of the late 1990s, the Eastern Cape's housing market has proven the most stable of all the regions, and is now poised for growth, says Dr Andrew Golding, CE of the Pam Golding Property group.
"Having steered a relatively even course through somewhat turbulent trading conditions – and bearing in mind that the residential property market is largely driven by sentiment and perception – it is apparent that the Eastern Cape rates well in the minds of most home owners, who have also had to contend with the challenges of stringent bank lending criteria and the National Credit Act," says Dr Golding.
"This region is also seen as a relatively safe environment with property values that are reasonable – with a good chance of escalation for the future. With family lifestyle playing an increasingly important role in determining people's choices of home buying, the Eastern Cape has excellent educational institutions, a factor which attracts families from South Africa and beyond. Port Elizabeth and the immediate surrounding areas provide ideal facilities for these families, including a healthy variety of activities including water and other sports, wonderful clean beaches, cycling and trails."
Record price in Port Elizabeth:
Despite the difficult trading conditions Pam Golding Properties achieved the highest price paid for a residential property in Port Elizabeth last year (2009), at over R10 million – for a five bedroom home set on an erf of 4000sqm in Upper Walmer. Another R10 million sale was recently concluded for a large property with panoramic sea views situated in the Chelsea area, on behalf of an overseas investor wishing to extend his business interests in the region. These exceed the previous highest price of R6.2 million – which was achieved in 2006 by PGP in Port Elizabeth.
Comments Andy Collett, regional manager for PGP in the Eastern Cape, Garden Route, Karoo and Kalahari: "Generally across the region the R600 000 to R1.6 million price range is attracting the most attention. Exceptions are found in Knysna, where prices average between R2.5- and R3.5 million (without sea views) with exceptional properties sold from R7-R14 million at Simola, Pezula and The Heads; in Plettenberg Bay where prices average from R3-R4 million with a plot on Beachyhead Drive near Robberg sold for R5 million; and also in St Francis Bay, where a house on the canals sold for R6.7 million in December 2009. While buyers are showing renewed interest they are cautious of over-priced properties as they are very aware of current market values."
Collett says PGP East London is experiencing a lively surge in demand with sales showing a significant upturn since December, with 20 homes sold at a total turnover of R22.3 million in January 2010, reflecting a significant increase over January 2009 when four units were sold at a total value of R12.8 million. 
Another area of interest is in game farms – including those for buffalo breeding - with the company recently achieving prices of around R3300 per hectare in the Graaff-Reinet area, while stock farms are selling for around R2500 per hectare in the eastern Karoo regions of Graaff-Reinet, Middelburg and Somerset East.
Says Collett: "The Coega development has final begun to have a positive spinoff for the residential sentiment in the region. Recent confirmation of the massive PetroSA refinery and attendant industries in the area provided the 'tipping point' for this with the creation of thousands of new job opportunities, underscored by the added impetus of the recent R40 billion export orders for VWSA.
"There are positive signs that the house market in the Eastern Cape is recovering with PGP interested buyer numbers up by some 50 percent since the beginning of the year (2010) and sales volumes for PGP up by just over 90 percent. Enquiries are once again being received for leisure properties, mostly below R2 million and along the Sunshine Coast from St Francis Bay to Port Alfred, signalling a much improved summer season for the property market. Discerning investors with residential property portfolios in the region have also become active – snapping up lower priced sectional title units mainly in the price range below R1 million – a price sector which yields good returns due to a buoyant rental market."
He adds that while much has been made of 2010 and the expected influx of foreigners into the country, PGP is geared for a sustained and focused drive to introduce visitors to the benefits of South Africa and address the questions surrounding purchasing South African properties. "We see the real benefit beyond next year as during the World Cup the world will be exposed to the beauty of our country with particular emphasis on the coastal areas. We anticipate that many more will make the journey to our country after the hype of the event is over," says Collett.
Issued by Gaye de Villiers

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