Current economic conditions such as high interest rates and the rising costs of living have impacted the property industry negatively for some time now. “It is for this very reason that the property market finds itself relying on the ‘Black Diamond’ sector of the South African economy to provide a positive impact in new home sales during these trying times,” says Marsha Haupt, sales director at Betterbond.
The term ‘Black Diamonds’ refers to wealthy black South Africans and includes black youth still living with their middle class families. The number of Black Diamonds contributing to SA’s economy has increased by 30% over a period of 13 months, bringing the total number of Black Diamonds in the country to 2,6-million.
“According to the UCT Unilever Institute and TNS Research Surveys, Black Diamonds reflect their status through their homes. Therefore, estate agents are correct in stating that buying a home is at the top of Black Diamonds’ priority lists,” notes Haupt.
Last years statistics show that Black Diamonds’ collective spending power stands at R180-billion per annum, accounting for 28% of total South African spend. In addition, FNB’s Property Barometer statistics reflect that 49% of buyers of residential property in some markets are non-white.
Today, approximately 47% of Black Diamonds live in the suburbs. This is 24% more than in 2005 when the total number of Black Diamonds living in suburbs was a mere 23%. Reports also estimate that since 2005 approximately 50 000 people a year moved from townships to more wealthy suburbs.
Commenting on why SA’s Black Diamonds find suburban property such an attractive investment, Haupt says that easier access to their jobs, improved security, better educational opportunities for their children and a visible, physical indication of success play an integral role.