Big opportunities at Big Bay

Big Bay on Cape Town’s Western Seaboard is fast approaching maturity, with the number of units still available for purchase directly from the developers reducing steadily.  

Pam Golding Properties (PGP) reports that there are just a handful of brand new apartments and vacant plots available in some of the developments, while others are already fully sold out and therefore only available via re-sales.  PGP’s area principle for the Western Seaboard, Emarie Campbell, says this means that the opportunities for savvy investors to make their initial purchase will not be available for very much longer.  She expects pricing in the suburb to rise as soon as the area is fully developed, with the subsequent shift in supply/demand dynamics allowing early buyers to achieve pleasing capital appreciation on their properties.

Big Bay was developed in the mid-2000’s, on land which was previously a potato farm, a parking lot and the home of popular surfing and windsurfing competitions.  Located on the northern edge of Bloubergstrand, the area has developed on both sides of Otto du Plessis Drive, and enjoys picture-postcard views of Table Mountain from its beachfront properties.  Many homes lie within easy walking distance of the beachfront, which remains a highly sought after location for surfing, wind-surfing and kite-boarding.

The first sales occurred from 2004, with the landmark Eden on the Bay development coming onto the market in 2006 – 80 percent of its units being sold even prior to the formal launch to market.  Buyers took occupation around two years later, and in the intervening years, a number of smaller developments have sprung up, including apartment blocks, townhouses and secure estates, as well as a few free-standing homes.  Lightstone data indicates that by the end of December 2012, the suburb included 63 freehold properties, 611 sectional title units, and a further 672 homes in secure estates.  There are also two shopping centres which jointly offer major retail facilities including supermarket and restaurants.

Campbell says current pricing in the suburb starts from an entry-level of around R715 000 for a modest apartment, with one-bedroomed units typically fetching between R1 million and R1.5 million.  A two-bedroomed apartment may cost from R1.5 million to R1.75 million, while there are plentiful purchase opportunities in the R2 million to R4 million price range for houses, townhouses and larger apartments.  The area also has a number of top-end luxury homes, both freehold and in secure estates, which quite regularly fetch over R5 million.

Lightstone sales figures for 2012 indicate that 56 properties changed hands in Big Bay during the year (across all agencies), at an average value of around R1.8 million. Nearly half of all sales fell within the price range from R1.5 million to R3 million.

“These are very competitive prices for the Cape Town market,” says Campbell, “especially when one considers the lifestyle that comes along with the purchase.  All amenities are within easy reach, the beach is on the doorstep, and some of the developments even have direct beach access from their homes.  For first-time buyers in particular, the appeal of buying directly from the developers is huge, because it means that no transfer costs are applicable to the sale.  

There is also good all-year-round tourism appeal which helps drive the demand for holiday rentals, and steady long-term rental potential for buy-to-let investors.  Rentals in Big Bay can range from around R5000 per month for a one-bedroomed apartment in Eden on the Bay, to R15 000 for larger homes and even as much as R30 000 per month for some of the luxury mansions.  This makes the area very attractive to investors, and we regularly conclude sales to up-country buyers for this purpose, as well as to a few international investors. There are also a few international clients buying for holiday use, especially members of the kite-surfing community.”
Among the units still available directly from the developers are a few apartments in Eden on the Bay, Sunset Bay and Ocean Mist, as well as 10 vacant erven in the Water’s Edge development.  One of the most recent developments, ‘Azure on Big Bay’, still has around 50 apartments available for sale, priced between R850 000 and R3.2 million.  This development is located less than 300m from the beachfront and offers a mix of one, two and three bedroomed apartments with superior finishes and excellent security.

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