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Berea home prices starting to lift

Homes on the Berea in Durban are once again in demand and prices are starting to show modest growth.
 
Even properties that have been languishing in the market - some for as long as four years - are now finding buyers, thanks to renewed confidence in the local property market, says Jonathan Styles, principal and owner of top local agency Harcourts Musgrave.
 
"A new mood of confidence has taken hold in the past quarter thanks to several factors, the first being that sellers who had tenaciously been clinging to asking prices that were out of step with the current market became more realistic after price counselling, with the result that buyers were once again able to see value for money in this area.
 
“Secondly, banks are also seeing value here and bonds of 100% are being granted to qualified buyers in cases where asking prices are a fair reflection of value. In one instance recently, a qualifying buyer even obtained a bond of 104% for an entry-level property - an occurrence last seen before the recession took hold.”
 
The main attractions of the Berea, he says, are its central position and good infrastructure, and about 50% of recent sales have been to newcomers – many of them dual income couples who work in different areas and want an easy commute to workplaces in the CBD, Pinetown and Umhlanga.
 
“We are also seeing a wave of buyers in the emerging middle class - about 70% of transactions now fall into this category – and the upsurge in demand is now underpinning a modest growth in prices, although buyers remain very realistic.”
 
Meanwhile, Styles says, there is also new residential and commercial development taking place on the Berea – which includes the suburbs of Musgrave, Essenwood and Morningside – to further underline the mood of optimism.
 
“In addition, greater confidence in the real estate industry is reflected in the fact that estate agents who left the industry during the recession are returning. We have increased our complement of agents by 30% since the beginning of the year to cope with the renewed demand for local housing and half of all the new appointees are fully qualified, experienced agents keen to resume their real estate careers.”
 
There is currently high buyer interest in family homes and townhouses priced at between R1,5m and R2,5m in Musgrave and Morningside, he says, although modest three-bedroom family homes are available at prices between R800 000 and R900 000 in areas such as Umbilo and Carrington Heights.
 
Starter one- or two-bedroom flats are available at prices of around R500 000, while luxury properties in the area can be priced at up to R20m.
 
The Berea rental market is also very active and Styles says stock has started to become scarce in the past three months, which will in due course put upward pressure on rentals. Rentals currently range between R4600 per month for basic two-bedroom flats and R20 000 a month for family homes with three bedrooms and two bathrooms.


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