Where opportunity grows

“Gardens has always been seen as an affluent suburb and the place to be as a young professional, especially for those in the creative industry. It is definitely a neighbourhood that speaks to a generation looking to build their careers as well as enjoy the benefits of living in a bustling cosmopolitan city. There are a vast number of chic restaurants, boutique style shops, luxury hotels and New York flavoured loft apartments. Gardens is regarded as Cape Town’s creative hub and is home to a variety of production companies, film studios, modelling agencies and publishing houses,” says Watts.

While still richly entrenched in South African history as home to some of the country’s oldest museums and monuments, Gardens is a far cry from the fresh produce garden it once was in the 1650’s. Although the renowned Government Avenue is still lined with the oak trees planted during the time of Simon van der Stel, today this inner-city suburb is also home to more contemporary attractions such as the five-star Mount Nelson Hotel.
Since January this year general demand for properties in the area has increased, particularly those that are correctly priced. Watts says that correctly priced properties are selling fairly quickly, however, those that are priced too high have run the risk of waiting many months to sell with some properties being on the market for over a year. Adrian Goslett, CEO of RE/MAX of Southern Africa, says: “This once again points to the importance of sellers pricing their homes at fair market value. In this market it is the buyers who are determining what that market value is and not the sellers.”

Watts says that the highest percentage of recent buyers in the area have been between 18 and 35 years of age and are predominately buying sectional title units. Currently, these types of properties are outselling freehold properties by three to one, with most of the movement in the R1 million to R1,5 million bracket. This is largely due to the fact that Gardens is made up of 66,74% sectional title units, with the remaining 33,26% consisting of freehold properties.

Pricing for an entry-level or bachelors unit starts at R450 000, while a one-bedroom apartment is priced from R900 000 upwards, depending on factors such as location and views. Due to the space constraints of inner-city living, one of the main factors affecting pricing is the parking bays available to the unit. This has a large influence on the demand and sale price of the property. In some instances an additional parking bay can cost the buyer as much as R100 000. She says that entry-level freehold homes are selling from R2 million upwards, while mid-level homes are selling from approximately R4,5 million upwards.  Top-end homes such as the seven-bedroom, 595m2 restored Victorian Villa that is currently on the RE/MAX Living books, are on the market for R6,3 million.
According to Lightstone, a property statistics and data provider, out of 5180 suburbs nationwide, Gardens fell within the top 50 in terms of the average valuation of a freehold property and was ranked 227 out of 1969 suburbs reviewed for the average valuation of a sectional title unit.

Why is Gardens a good investment option? “Many tend to forget that property is not a short term money spinner, but over the long term it has proven to be a great investment, especially in Cape Town.  We have had challenges in our local market but, compared to other regions, they are insignificant. We have a fantastic climate, scenery that ranks us as one of the top cities in the world and the attitude of the locals is positive and upbeat - what more could one ask for?” asks Watts.  “It is clear that people are still apprehensive about whether or not the recession is in fact over. We are not immune to global market trends but Gardens has done specifically well in retaining good investment returns over the long term and will continue to do so in the future.  Looking at the local market and our growth as a company over the last three years, it is clear that despite the global market conditions the property market here remains buoyant.”

According to Watts there won’t be any major surprises in the Gardens property market in the near future. “I do not expect a huge increase in sales over the next few months but I certainly expect to see a gradual increase over the next few years. I reiterate that sellers in this market will have to be wary of overpricing and should rely on the facts and figures provided by a trained real estate professional in order to price their property correctly in the current market,” Watts concludes.

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