Values climb in McGregor

Property prices are holding their own in the quaint Western Cape village of McGregor, located at the foot of the Riviersonderend mountains, some 20km from Robertson.

Pam Golding Properties reports that the number of sales concluded in the charming village has nearly doubled over the past year, while the average selling price has gone up around 17 percent.

“In 2010, there were just 24 sales of plots and houses in McGregor, by all agencies,” says PGP’s MD for the Boland and Overberg regions, Annien Borg, “and the average price was around R545 000.  But last year (2011) the figure nearly doubled to 46 sales, while the average price leapt to around R640 000.  Buyers were mostly South Africans, and included a number of retirees, which is not unusual for the town.  But it is interesting to note that there were also a significant number of younger buyers, some purchasing for their future retirement but intending to use the property as a weekend getaway in the interim or to rent it out to weekend users for additional income.  Another notable category among the younger buyers was that of people running internet-based businesses, who can work from home, unrestricted by location.  For this market, McGregor is the ideal destination, offering an affordable, quiet country lifestyle, low crime levels and a wholesome environment in which to raise a family – yet still being within easy reach of an international airport and big city infrastructure.”

McGregor is renowned for its appealing Victorian character, and strict design guidelines ensure the unique ambience is not disturbed by unchecked building. PGP agent Chris Steytler says building costs are currently relatively low in the village, usually amounting to between R6000 and R7000 per sqm.  “This means that it is still, in some cases, cheaper to build than to buy,” he says, “resulting in sustained demand for vacant land.  Sales in 2011 included a number of vacant plots, mostly stands of around 1000sqm.  These typically sell for around R450 000, although it is still possible to obtain smaller stands of 500sqm at around R275 0000.  Larger erven of 2000sqm and more are priced from R850 000 upwards.  The town is a hive of building activity at the moment, as many of these recent buyers have already commenced building their retirement homes and weekend cottages.”

Borg has a word of caution for those considering buying vacant land in McGregor. “Buy sooner rather than later,” she says.  “The number of good plots still available for purchase has dwindled substantially over the past 18 months, due to the high sales activity in this segment of the market.  McGregor is geographically limited by the nature reserve surrounding it on one side, and by productive farms on the other. The result is that the town’s limits cannot be expanded, so the current available land is all that’s left to develop.  This also has long-term implications for investment values, as the existing properties can only increase in value.”

Borg says in addition to the market for vacant land, there is also ongoing demand for houses in the village, particularly small cottages priced up to R1 million.  An entry level cottage in good condition can still be obtained for around R800 000, with the price tag increasing to around R1.2 million for a small house, and R1.8 million for larger family homes.  “There is not much appetite for the top end of the market at present,” she says, “which in McGregor terms, equates to properties priced over R2 million.  But we have seen a number of younger buyers in particular purchasing older homes to renovate for personal or guesthouse use.  Some existing McGregor residents have also purchased second properties to renovate and generate rental income.  The property mix on the outskirts of the village also includes some lifestyle farms in the R3 million to R4 million price bracket, while productive farms cost anywhere between R8 million and R15 million.”

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