|KROONSTAD, Free State (July 24) - As production on De Beers’ R1,2 billion “Voorspoed” diamond mine in Kroonstad gathers momentum, home buyer volumes in the area are also swelling.|
The third largest town in the Free State, Kroonstad is already soaking up the benefits of the mine expected to reach full production in the second quarter of 2009.
Annelie Botha, principal of Acutts Kroonstad reports construction of the open-cast mine “well under way” and expected to create 700 jobs on completion. A further 400 jobs will be available for the duration of the mine’s life, which experts estimate will be between 12 and 16 years, during which an estimated 10 million carats will be produced.
“Movement in the Kroonstad property market has already increased with property-related enquiries coming from Namibia, largely from diamond industry workers,” she says. Even without the pulling power of the mine, property prices in Kroonstad have been rising steadily, more than tripling in the last four years. This, says Botha, has pushed the average house price up from around R200 000 in 2003 to the current R650 000.
“Up until now, the well-being of the farming community has been the major driver of our real estate market. However, the growth of the diamond industry in the area and its subsequent commercial spin-offs, are likely to push prices up significantly in the next few years,” she predicts.
House prices in Kroonstad are finally playing catch-up with the national average. In up-market suburbs such as the river-fronting Panorama, which overlooks the local golf course, people can expect to pay between R2 million and R3 million. Most purchasers are business owners whose search focuses on Van der Lingen Street, where homes enjoy golf course and river views.
Entry level buyers can pick up former railway houses in suburbs such as Lower Kroonheuwel selling upwards of R250 000. These properties are gaining popularity among correctional services, police and military employees whose home buying affordability levels have been severely curtailed by the rampant house price growth in the area in recent years.
Middle market buyers who can spend from R550 000 to R650 000 have access to generously proportioned, old-style homes on large stands. Demand, however, is growing by both locals and newcomers to the town in pursuit of modern homes, which are few and far between in Kroonstad. “There has been very limited residential development in the town in recent years, partly because vacant plots are extremely scarce and usually sold by the local municipality on tender. Some stands have recently been secured by developers, creating expectations of new townhouse development within the next couple of years,” she says.