What drives Umhlanga prices upwards?

Located some 15km from Durban on the KwaZulu-Natal north coast the scenic Umhlanga Rocks area retains its appeal for savvy home buyers, particularly the Umhlanga beachfront, which continues to be highly sought after, with little new stock available,” says Elwyn Schenk, Pam Golding Properties (PGP) area principal. “However several new projects are in the pipeline, albeit with a three to five year timeline. This means that existing stock should, even with modest growth, start to see a strong uplift in prices.”

He says sound medium to long term investment potential is another key motivation for residential property buyers in this area, which is also within easy reach of the new airport and all major routes to Durban and North and South.

“The opulent ‘Dubai-style’ Pearls development, right on the main beachfront and comprising a mix of luxury apartments, duplexes and penthouses, has proven an extremely sound investment with values having more than doubled since launch just five years ago. Investment potential of Umhlanga property, especially on the seafront, has proven very resilient over the years, mainly due to its scarcity value.

“For many people Umhlanga is a close second to the Cape’s Atlantic Seaboard as a highly desirable area in which to live. From a property value perspective this is certainly reflected in property prices – while luxury homes can fetch upwards of R40 million on the Atlantic Seaboard, in Umhlanga top apartments can be acquired for less than half that amount.  From a quality of life consideration, Umhlanga is a close rival for the top spot – a viewpoint shared by many locals who would argue it is preferable given the year round exceptional climate,” says Schenk.

Recent sales by Pam Golding Properties include two properties in Lagoon Drive, which runs along the main Umhlanga beachfront, the first a 238sqm four bedroom apartment sold for R6.7 million and the second a three bedroom apartment of 290sqm which fetched R5 million.On the south side of Umhlanga, with direct beach access, PGP sold a four bedroom, 260sqm apartment for R5.1 million.

“All these properties were for the owners’ personal use.The average price per square metre is between R15 000 and R28 000, which is considered modest for beachfront properties.The Pearls, arguably the most luxurious apartment blocks on the beachfront, have a few remaining units on sale at up to R35 000 per square metre. Direct comparisons with the Cape are difficult, however, in areas such as Camps Bay, prices are generally higher at R25 000 to R70 000 per square metre.
“Ironically, property in certain countries which were badly affected by the credit crisis can be purchased for around the same levels as in South Africa, at current exchange rates.Thus beachfront property in Spain’s costa Blanca is available at between R15 000 and R30 000 per square metre, but obviously caution and due diligence is required when investing in foreign markets.  

The impact of the global financial crisis was far less severe in South Africa than in Europe and the United States. The effect in more affluent areas of South Africa such as Umhlanga was even more muted and prices remained relatively flat. Serious sellers, however, had to be more realistic in their pricing aspirations which meant that in such instances asking prices were adjusted according to market conditions.

“Durban is South Africa’s only destination with tropical summers, balmy winter weather and 320 sunny days a year. Visitors from around the world flock to the holiday resort of Umhlanga to relax and have fun on one of the most beautiful coastlines in the world. Add to this first world shopping centres and the King Shaka International Airport and you have an enviable location in which to live, work and enjoy a wide variety of leisure activities in a relatively low crime area.”

Schenk says predictably the most sought after apartments are on the beachfront. Along Marine Drive in the south are established complexes such as La Lucia Bay, with units affording direct access to the beach, and priced from R7.5 million. Two of the three units currently on sale have private, exclusive use gardens with beautiful dune vegetation separating them from the pristine beach, which is popular among surf fishermen, paddle skiers and wind surfers alike. Priced at R8.5 million, one of the units has recently been completely refurbished to a high standard.

Close to Umhlanga village is a cluster of four high rise apartments adjacent to the 5-Star Oyster Box Hotel, now world famous for hosting a spectacular reception for the newly-wed royal couple of Monaco. Within this grouping of high rise apartments a multi-level penthouse at Oyster Quays is on the market for R18.9 million. Comprising 575sqm and with five bedrooms and four bathrooms, this apartment incorporates two enclosed living areas with a Jacuzzi, roof garden and pool with 360 degree views which include ocean vistas both up and down this scenic coastline.

Smaller apartments in the same complex start from R5 million – which would comprise a two bedroom unit with a high standard of finishes and excellent sea views.

On the northern beaches, which include the main swimming beaches, is Lagoon Drive, home to apartments of various styles and sizes and priced from R2.5 million to R20 million. “All these areas in Umhlanga are literally minutes’ walk to the beach, village and restaurants, resulting in their values having increased substantially over the years,” adds Schenk.

It will would seem that Umhlanga is fast becoming the East Coast’s property hotspot.

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