Supply shortage pushes demand in Secunda

A shortage of supply has led to high levels of demand for property within the Secunda area. This is according to Laetitia Swiegers, one of the Broker/Owners of RE/MAX Homefinders, whose office services the areas of Secunda, Trichardt, Evander, Kinross, Bethal, Kriel, Leslie, Standerton, Ermelo and Embalenhle.

“Due to the fact that there is currently a huge shortage of property available in Secunda, we are seeing a lot of development in the area with construction on nearly every available piece on land. Cosmos View, a development consisting of 256 properties ranging from R549 000 to R750 000, was sold out in a less than a month in October 2012. Many of the properties in new developments are sold off-plan before the developer has had the chance to complete them,” says Swiegers.

She adds that many of the existing homeowners in the area are capitalising on the shortage of accommodation by turning their single and double garages into flats and renting them out. “Quite a few of the recent homebuyers in the area are turning their homes into a type of commune or sub-dividing the land into two properties,” says Swiegers.

According to Swiegers the strong demand is due to an influx of new SASOL employees. “SASOL is the main source of employment in this area and it is expanding its business by erecting new plants,” she says. “SASOL does not currently have enough accommodation for its new employees and this has increased the demand for property in the Secunda area. The demand has pushed prices up, and homeowners are currently seeing good returns on their investment.”

Swiegers says that according to figures compiled on Secunda, Trichardt and Evander, 656 properties were sold and transferred in the past 12 months, with the year-to-date figures currently sitting at around 201 properties sold. Secunda property has the largest market share in the region with R479 million worth of property sold in the past 12 months, while the total value of property sold in Evander was R111 million for the same period. The average price of property sold in Secunda over the past 12 months was approximately R1.1 million, which has recently increased to R1.22 million because of the high demand and low levels of supply.

 According to Swiegers, an entry level home in a high-density, modern townhouse development would cost between R540 000 and R770 000 in Trichardt, and would offer three bedrooms, an open-plan kitchen and lounge and under-cover parking. She notes that these homes generally suit first-time buyers and smaller families, and are excellent units to move into with very little maintenance needed.

Secunda’s mid-level homes range from approximately R1.2 million to around R1.5 million, and generally offer the buyer a large four-bedroom house with two or three living areas, two bathrooms (one en-suite), a single or double garage, swimming pool and a stand of approximately 900m2. These homes may require some attention and renovation.

Top-end homes in Secunda are priced from R1.6 million and can range up to R3.5 million or more. The lower price range in this category would offer a contemporary home that would feature between three and four bedrooms and bathrooms, three or four large open-plan living areas, an entertainment area, swimming pool, modern kitchen, multiple garages, security system and landscaped garden.

She notes that around 52% of Secunda’s buyers are between the ages of 18 and 35 years old, with most investing in entry level and mid-level properties.  Around 30% of the buyers are between the ages of 36 and 49 years old, with these buyers generally opting for mid-level properties to those priced up to R1.6 million.

“There is no reason to believe that the property market in Secunda will reach a plateau anytime in the next 18 months,” says Swiegers. “Demand and supply is dictating the property prices and should continue to do so for some time to come,” she concludes.

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