|In line with international trends the demand for premium properties on the beach overlooking the sea along Durban’s Golden Mile remains high, and it is highly unlikely that this trend will change in the long term. |
“Although the initial surge in prices has slowed somewhat this can be attributed more to the fact that some sellers are demanding unrealistic prices than it can be to a lack of buyers.” says Keith Wakefield CEO of Wakefields Estate Agents. Properties, from north to south beach, priced correctly continue to be snapped up while the over priced flats remain unsold.
“The casino has had a very positive effect on the price of units on the North Beach, and the addition of a new hotel to the casino can only place further upward pressure on property values in the area.”
Prices for front line flats (beach fronting flats) vary from R600 000 to R700 000 for a one bedroom flat and reach up to R900 000 for two bedroom. A three bedroom unit can fetch up to R2, 5 million while penthouses start from around R2 million.
Properties that are not on the frontline are fetching slightly lower prices. One-bedroom flats vary between R400 000 and R600 000 while two bedroom flats are priced between R500 000 and R750 000, and three bedrooms flats are price from R650 000 to R850 000.
On the North Beach the majority of properties are on the share block system. Due to a number of advantages associated with share block ownership the shareholders of the majority of these buildings have elected to remain on the share block system, and not convert to sectional title.
There are financial institutions willing to provide finance for share block units. However, the requirements are that a prospective buyer provides a deposit of at least 33% of the purchase price and is willing to accept a repayment period of between seven and 10 years.
According to Wakefields Beach office demand for property, both share block and sectional title, is strong with a high percentage of share block apartments being sold on a cash basis.
They have noted that increasingly people are purchasing these flats as a primary residence rather than as an investment to place on the rental market. Subsequently quality rentals are becoming more difficult to find.
On the South Beach, where most of the properties are registered sectional title buildings, the u’Shaka Marine World and Durban Point developments have both had an enormous affect on prices.
“Increases of up to 100% have been achieved over the past couple of years. However, these increases cannot be sustained in the short term and although prices are continuing to rise they are doing so more realistically,” says Wakefield.
Front line properties here are fetching price between R500 000 and R700 000 for a one bedroom flat; between R700 000 and R800 000 for two bedrooms and between R800 000 and R1, 5 million for a three bedroom flat.
One road back from the beach front a one bedroom unit sells for between R300 000 and R450 000; two bedrooms for between R450 000 and R650 000 and three bedrooms for between R600 000 and R800 000.
“It is worth noting that the Point development is largely still in the early stages and there is still an awful amount of investment to come, which in the near future can only have a very positive affect on the existing South beach properties,” says Wakefield.