Demand for sectional title property improves as first time buyers enter the market

Sectional title property is in demand, with the increase of first time home buyers onto the market, together with improved leading conditions - sectional title property prices are on the rise.

For the first time since 2007/2008, there are signs that sectional title developers are coming back into the market, on the back of increased demand from first time buyers entering the market! 

Jawitz Properties’ CEO Herschel Jawitz says that recovering property conditions are prompted by a ‘push-up’ approach from the lower end of the market.  This push up is critical to the recovery of the market as it allows those sellers to move up into the middle price market and so on!  Despite high levels of consumer debt, demand in this segment is strong and is always a good indication of where the market is heading.

“With house prices still offering good value and interest rates at historic lows, there is no shortage of first time buyers but access to finance remains a challenge. Affordability is not the issue but rather having enough for a deposit and transfer costs. The situation has eased with the banks now offering 100% bonds to certain clients up to R1.5 million but the decline rates still remain high.  

First time buyers generally buy sectional title units – townhouses or small apartments but supply of these units is constrained. It is only now that developers are getting back into the market but with long lead times, demand will outstrip supply in the short and medium terms. As demand continues to outstrip supply, prices are expected to rise.” he says.

Jawitz cautioned entry level buyers to do their homework before buying into a sectional title complex.  Issues such as the financial state of the complex, how well it is being managed, are there any law suits against the building, how well it is maintained and are there any special levies in place.  Care should be taken to enquire about the Body Corporate’s rules especially relating pets on the premises. It’s also helpful to find out who is responsible for repairs and upkeep. The rule of thumb is normally that anything relating to the interiors is for the owner’s account, but any exterior repairs are the Body Corporate’s responsibility. 

“We find that owners tend to be apathetic about getting involved with the Body Corporate which is counter productive as they invested in a unit and it is in their interests to protect their asset.   By the same token, some people baulk at the rules and regulations attached to a complex, but in truth, the stricter the Body Corporate and the more pedantic it is, the better those complexes are run, and the more financially secure they are. Ultimately the rules are there to enhance the value of the complex that will inevitably increase the owner’s return on investment when it comes to selling.  Owners should always find out as much as possible from the estate agent before putting in an offer to purchase,” he says.

At the higher end of the market, lifestyle sectional title complexes are setting the trend, moving away from blocks of flats or townhouses. Buyers are more discerning and look for indoor pools, gyms, concierge services and communal entertainment.  Also trending are urban neighbourhoods such as the Maboneng Precinct in the Joburg inner city and in Cape Town where the CBDs offer a cosmopolitan lifestyle, entertainment, a great night life and are close to work,.

  Comment on this Article

  Please login to post comments

Post to my facebook wall
Characters remaining

    Latest Property News
    • 21 Nov 2017
      The buying process is over, and the moving truck has delivered your household goods to your new property. Now it’s time to unpack and turn your new house into a home.
    • 21 Nov 2017
      When an offer to purchase a property is signed by both buyer and seller, this constitutes a binding agreement or “Deed of Sale” between the two parties. However, in most cases the “standard contract” might not be enough to cover all the specifics pertaining to the sale. The agreement may require some additions or alterations to clauses, which needs an expert hand in the drafting of such
    • 21 Nov 2017
      As more and more South Africans look to invest in property abroad, Spain is offering them one of the best deals in global real estate.
    • 20 Nov 2017
      Since 2012, sectional title complexes have been leading the South African property market, not only in terms of price growth, but sales volumes as well. Remaining relatively strong, even in the face of 2017’s political and economic turmoil, experts say this market segment could offer valuable insight into South Africans’ property purchase priorities.
    • 20 Nov 2017
      Regardless of whether you are purchasing your first start-up home, downsizing or moving in with roommates, finding ways to maximise small spaces can be a big advantage, says Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa.
    • 20 Nov 2017
      Property valued at approximately R1 billion is on High Street Auctions’ sales floor during the month of November, including the much-anticipated sale of the Tshwane Mayoral Residence and the land occupied by one of South Africa’s oldest operating gold mines.
    • 17 Nov 2017
      FWJK has announced the launch of its latest residential brand, the Lil’ Apple, which will be launched simultaneously in two developments in Cape Town and Umhlanga totaling 600 apartments. The Lil’ Apple is set to be a brand of FWJK’s New York style apartments which will be rolled out nationally.
    • 17 Nov 2017
      It’s been a tumultuous year on many fronts, with socio-political uncertainty setting the tone for much of South Africa’s economic activity yet despite this and seemingly counter-intuitively, the residential property market has held up well.
    Subscribe to the MyProperty Newsletter

    Last Name  
    Email Address  
    Email Frequency
    Share this Page

    For Sale Property
    Rental Property
    More Options
    Connect with us