select
|

No brakes yet on property’s bull run

Neither the upcoming election nor the prospect of further interest rate increases this year has done anything to slow down the residential property market in the past few months.
 

This contemporary home in Sandhurst was recently sold by Sotheby's International Realty for R21m

That’s the word from Lew Geffen, chairman of Sotheby’s International Realty in SA, who says the top end of the market, especially, is strong countrywide at the moment – and “on fire” in Cape Town and Johannesburg.
 
“Sales volumes are up at least 5% across the board since the beginning of the year, and we have been experiencing record months in many areas. In March alone, for example, we sold R120m worth of property on the Atlantic Seaboard, including a V&A Waterfront property sold for R38m.


This Barbados-inspired home in Hyde Park was recently sold by Sotheby's International Realty for R11,25m 

“Other properties sold in this area in the past three months include a Clifton home sold for R49m and a Camps Bay property sold for R28m, while in Johannesburg we have sold more than R150m worth of ‘big ticket’ properties in the past three months, including two Sandhurst cluster homes sold for R28,5m each, a Sandhurst house sold for R21m, a rare vacant stand in Sandhurst sold for R13m and a Hyde Park property sold for R11,25m.”
 
What is more, he says, high-end buyers are apparently not averse to paying the higher prices that are the result of a growing shortage of properties for sale in the most sought-after areas – provided they see value-for-money.


This magnificent home in Camps Bay was recently sold by Sotheby's International Realty for R49m  

“The most recent Absa statistics show that the average price of luxury homes grew by just under 5% last year and that of large homes by 9,5%, and our own experience would suggest further gains in the first few months of 2014.
 
“Our average sale price achieved has risen 39% from R2,3m in 2012 to R3,2m currently and we are certainly experiencing far less buyer resistance than there was then - although it must be said that buyers in this sector are particularly well informed about market trends in the areas they are targeting, and averse to even viewing properties they regard as being overpriced.”
 
Meanwhile it is interesting that one major reason for the high level of activity at the moment, Geffen says, is a huge influx into the market of buyers employed by banks and other financial institutions.


This Cape Cod designer home in Camps Bay was recently sold by Sotheby's International Realty for R16m 


 “We are finding that up to 40% of sales in some areas are to these ‘institutional’ buyers, most of whom have pre-approved, 100% bonds, so we can only assume that they have been advised by their employers that now is a good time to buy and / or upgrade, before interest rates – and prices – rise any further.”
 
In addition, he says, high net worth buyers are generally good at reading markets, and have obviously picked up on the fact that time is running out if they still wish to upgrade from existing homes to more luxurious properties at a “discount”.
 
“Such buyers know very well that those who own luxury homes generally have no urgency to sell, and in fact tend to resist selling in a rising market. These owners will often actually withdraw their properties from the market and thereby create a shortage of supply that immediately drives prices even higher, which is exactly the scenario we now see developing.”


  Comment on this Article

  Please login to post comments

Post to my facebook wall
  
2000
Characters remaining


    Latest Property News
    • 16 Feb 2018
      Whether you own a property in a sectional title complex or are looking to invest in one, the financial standing of the body corporate is the single most important thing that can affect your investment or your buying decision.
    • 15 Feb 2018
      One positive consequence of the financial crash in 2008 was the rise in consumerism, especially in the property market, where buyers have steadily become more knowledgeable and more value conscious.
    • 15 Feb 2018
      While most homeowners will take the agent’s commission into consideration when they are trying to determine what the will get out from the sale of their property, many often forget to factor in the other costs involved in a home sale, says Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa.
    • 14 Feb 2018
      The forecast for the national rental market in 2018 remains a mixed bag of good news and bad news. Although rentals are expected to rise slowly as the challenges of home affordability and tighter lending criteria tighten their grip, it’s a double-edged sword as the market also will come under increasing pressure from factors like declining disposable income levels.
    • 14 Feb 2018
      While you may not have intended to place your home on the market, what do you do if you receive an unexpected offer on your home? In areas where demand outweighs the current supply of homes available to buyers, it is not unheard of to have buyers make offers on homes that aren’t on the market, says Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa.
    • 14 Feb 2018
      If you are looking to sell your home this year, Debbie Justus-Ferns, divisional manager of Renprop Residential Sales, says that there are five crucial things to do before the ‘for sale’ sign goes up.
    • 01 Feb 2018
      February is the month of love and to celebrate we will be posting about all the things we love this month. Follow the #MyPropertyLoves hashtag to keep up with our favourite things.
    • 01 Feb 2018
      After saving up and months of searching for the right home, applying for a bond and patiently waiting for the keys to the front door, it is finally time to cross the threshold and move into your new home. Now what?
        
    X
    Subscribe to the MyProperty Newsletter

    Name  
    Last Name  
    Email Address  
    Email Frequency
    select
    X
    Share this Page

       
    For Sale Property
    Rental Property
    More Options
    About
    Connect with us
    FEEDBACK