There is no sharp upturn on the cards for the Eastern Cape residential property market, but continued steady growth is expected.
That's the word from Dave Summerton, Homenet regional director for the
Eastern Cape and principal of Homenet Summerton, who says the market has
slowed down in comparison to last year and that growth is now around 1% a
There are more properties for sale in most areas, show house attendances are
on the decline and there are fewer enquiries coming in.
However, while prices have become much more negotiable at the top end of the
market, there is still "reasonable" demand at the lower end and flats and
townhouses within the more affordable price bands are selling well.
"One factor that is affecting the market badly, especially among younger
buyers, is fuel prices. Another factor having an impact is the new National
Credit Act which has seen banks start to apply stricter lending criteria."
Looking at the region in more detail, Summerton says the East London and
Port Alfred areas are experiencing similar conditions to Port Elizabeth,
with lower sales volumes, but that there has been steady growth in Jeffrey's
Bay and that there is now a lot of development taking place in and around
Turning to the rental market, he says demand is good - especially for homes
that let for R2500 to R4000 a month - and that rentals are rising by around
5% a year, with flats in the centre of Port Elizabeth doing even better.
Looking ahead, Summerton says further steady growth is to be expected. "With
more jobs being created ahead of the 2010 Soccer World Cup, and for the
local population in general, more potential buyers will have greater
In addition the Eastern Cape is expected to reap tourism benefits from the
World Cup due to its malaria-free status and ample selection of game parks."