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Solid demand for real estate on KwaZulu Natal’s North Coast

There is a strong and steady demand for property on the KwaZulu-Natal north coast, especially in the Durban North, La Lucia and Glenashley areas, according to Grant Gavin, Broker/Owner of RE/MAX Panache.


Central Durban North, entertainers delight with three flatlets. This property offers effortless entertainment flow from several reception rooms, open plan gourmet kitchen, to fitted pub decked patio and stunning entertainment gazebo overlooking sparkling pool and landscaped garden. This four-bedroom home is on the market for R5,495,000 through RE/MAX Panache. 
 
Gavin says that his offices sold in excess of R900-million worth of property in 2013, which works out to an average of R76-million or the sale of around 40 properties each and every month. 

“These figures reflect that the property market within the North Durban suburbs is very buoyant, with a strong demand driving a steady stream of sales. The area has great access to Central Durban and Umhlanga, added to which, there continues to be a lot of growth in the Umhlanga and La Lucia business areas which further drives demand from those who want to live closer to their place of work.  The North Durban suburbs are also close to the beaches and entertainment complexes, as well as to numerous good schools, most of which require parents to be living in the correct catchment zones.”
 
Gavin reports that his offices’ registered sales figures are up 27% year-on-year and that when compared to total area sales figures registered in the Deeds Office, they recorded very strong market share in the region last year.  Sales concluded through the RE/MAX Panache offices accounted for 35% of all property sales in Durban North, 32% in La Lucia, 43% in Glen Anil /Glen Hills, 44% in Sunningdale and an impressive 54% market share in Glenashley /Virginia.
 
While the average price of a property sold by RE/MAX Panache agents across all of these suburbs during 2013 was R2-million, Gavin explains that the market ranges from entry level apartments in Umgeni Park and Gateway priced at R850 000, to luxury properties in Mount Edgecombe Estate priced at R15-million. “Most of our sales fall in the R1.5-million to R2,5-million price range as our main demand is for homes in this range.  The suburbs where we sell the most homes are Durban North where, according to Lightstone statistics, the average home sells for a little under R2.5-million, La Lucia where the average home sells for a little under R2.6-million, Glenashley where the average home sells for around R2.2m, Sunningdale where properties have an average price of R1.5-milliom and Glen Anil/Glen Hills with an average home price of R1.3-million.”
 
According to RE/MAX Panache 2013 statistics, sole mandates sold by the company spent on average 28 days on the market, which is below the national market average of 112 days, again proving the area is a popular choice for purchasers. Added to this, sole mandates sold by the company achieved average selling prices of 94% of the asking price, which is again substantially higher than the national average of between 89% and 90%.
 
The most popular property type among North Durban buyers during 2013 were those situated within a complex or an estate. “Properties in complexes or estates that came onto the market in the R3-million and below range literally flew off the shelves,” says Gavin. “People want to be in a sectional title complex or an estate as security remains one of the top priorities for purchasers in our area.”

Adrian Goslett, CEO of RE/MAX of Southern Africa, says that security features are a top priority for many buyers in South Africa, so it is no surprise that it has been one of the driving factors behind the growth in popularity of secure developments. “It is easy to see why so many are choosing to stay in closed communities such as gated complexes and secure estates due to the lifestyle benefits, sense of community and security that they provide.”

Gavin notes that in terms of freehold properties, buyers are always on the lookout for older homes that they can renovate and upgrade. “These properties are particularly attractive to younger families due to the fact that they provide an entry level opportunity into the suburbs of Durban North, La Lucia, and Glenashley, where any investment into the property market ultimately holds really good value. We had quite a few of these properties listed in 2013 and the demand was phenomenal.”
 
Looking ahead Gavin said that at the end of 2013 he had anticipated similar market conditions for 2014, with similar trends in stock levels, as well as in terms of what purchasers are looking for. 

Things in the property market have however, not remained the same. “The interesting change this year has been the largely unexpected increase in interest rates so early in the year, and we will watch with interest as to how this plays out for the remainder of 2014.  I wouldn’t rule out further increases at some point in 2014, which will obviously have an impact on the market in terms of affordability.  Purchasers who have been buying up properties over the past two years have been doing so at the most affordable interest rates in our lifetime, but now the reality of further rate hikes means that purchasers must be prudent when calculating their own affordability.  They will need to factor in increases of at least another 1,5% to 2% over the next two to three years as we enter a new phase in the property cycle,” he concludes.

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