Smart sellers cash in on soaring demand for Atlantic Seaboard housing

Selling conditions on the Atlantic Seaboard continue to improve and smart sellers are cashing in on the soaring demand, says Ian Slot, Seeff's managing director for the areas. 

Trade in the exclusive suburbs of Clifton, Bantry Bay, Fresnaye, Camps Bay and at the V&A Waterfront is at the highest levels since 2009. Properties are selling twice as fast and the difference between the asking and selling price has halved from well over 20% to about 10% on average.

5 bedroom Apartment for sale in Clifton, Cape Town

About R4 billion (777 sales) in real estate has sold across the area in the last year, almost double the R2,3 billion (506 sales) recorded for 2009, says Slot. Activity in the R10 million-plus price sector has improved almost two-fold with just under 100 sales compared to 58 five years ago. At the top end, some 27 properties have sold priced upwards of R20 million to R42,5 million for a Bantry Bay apartment and R55,86 million for a Clifton villa; both sold by Seeff.

The average house prices continue climb and trumps the national average of 7%-8% as these prime areas continue to prove its investment value, continues Slot. In Clifton for example, the average house price was R14,4 million in 2009 and is now at around R17,2 million, an improvement of 19%. Fresnaye's exclusive homes now sell for around R7,8 million on average, up by 39% from R5,6 million five years ago. Bantry Bay now boasts an average price of R10,1 million, 26% more than the 2009-price of R8 million.

4 Bedroom House for sale in Camps Bay, Cape Town

Buyer interest is almost across the board - local buyers are trading up and down while upcountry buyers are once again investing in second and holiday homes. Foreigners, mostly from the UK and Europe are once again investing their cash in property here while buyers from the continent, mostly the petro-rich African countries such as Nigeria and Angola continue snapping up homes in this exclusive real estate belt. Slot says that a high percentage of South African expats have also bought in the area over the last few months.

The pent up demand has been building over the last few years and the market is hot right now, he says. Moving from a buyers' market five years ago, conditions now most certainly favour serious sellers. On the back of wide-scale stock shortages, both in the sub-R10 million sector and at the top end of the market, sellers are now able to get better prices.

In areas such as Fresnaye and Bantry Bay, the demand for houses below R12 million exceeds supply, say agents, Cecily Sher, Karen Lurie and Colette Jackson. We are simply unable to keep up with the buyer enquiries and anyone looking to sell right now, is likely to find a buyer and a good price.

4 Bedroom House for sale in Fresnaye, Cape Town

Camps Bay agents, Pola and Nadine Jocum and Chrys Mammous say that they have not seen the level of activity here in years. Properties are selling twice as fast; our team alone now sell an average of four properties per month. Five years ago, sellers were getting 20%-30% below asking price, they can now get within 10%. While 70% of all sales are still below R10 million, there is good interest at the top end with luxury homes selling for up to R15,9 million in Susan Avenue and R19,5 million in Hove Road; both sold by the agents. At the upper end of the market though, luxury buyers are not prepared to compromise on finishes, room sizes and views.

Even at the top end there is a shortage of stock, says luxury market specialist, Lance Cohen. Bantry Bay, Fresnaye and Clifton in particular is seeing strong demand and the agent has already made several top end sales this year ranging from R20,5 million in Bantry Bay (Top Road) to R29 million for a sea-view apartment in Cliffrock a luxury villa in Clifton Road for R55,86 million, the highest price paid on the Atlantic Seaboard this year.

Luxury sectional title agents, Adrian Mauerberger and Rosa Park say that big budget buyers, both residential and investors are once again shopping for apartments, especially in the R3-R9 million price range. Event at the top end, buyers are prepared to pay up to R42,5 million for a 600sqm luxury unit with a private pool and panoramic sea views in The Bantry. This is also a new record price for the suburb, significantly more than the previous highest price of R34,5 million was set in June last year. Top end Bantry Bay apartments now sell for around R70,000/sqm and R30,000-R45,000/sqm in Fresnaye while Sea Point sellers can expect around R27,000-R40,000/sqm.

Activity over the past few months at the V&A Waterfront have been at the highest levels since 2008, say agents, Ross Levin and Kim Bailey. Apartment sales for the first five months of this year already amounts to almost R140 million, 17% up on the R120 million sold during the same period last year. Buyers, mostly South Africans, have paid up to just under R24 million (VAT inclusive) for 255sqm apartment in Palgrave, recently sold by the agents. At R81,395/sqm, this is one of the highest prices ever paid for an apartment, indicative of the strong demand, say the agents. Here too, stock is in short supply. Sellers can expect to achieve average prices of R48,000/sqm on the Canals and R67,000/sqm at the Front Yacht Basin (FYB).

Despite the widely publicised stock shortages, there is still very little coming onto the market, says Slot. It is a real concern that sellers may be holding out in the hope of a significant uptick in prices, but given the economic climate, this is unlikely for the foreseeable future. While buyers are now prepared to pay a more, this depends on perceived value and sellers holding out now risk losing out on the ideal selling conditions.

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