HUGE DEMAND FOR CITY PROPERTY

Huge demand for city property
07/02/2005 12:12 - (SA)
Lynn Bolin

Cape Town - As 2005 moves well into its first quarter, the residential property market in Cape Town remains buoyant with a particularly strong demand from local buyers, according to Mick Joyce, managing director of Pam Golding Properties' (PGP) Western Cape metro region.
Commenting on the residential property market on Monday, Joyce said that homes in the middle price range from R500 000 up to around R2.5m were receiving the most attention, further boosted by low interest rates.

PGP sales in the upper end of the market remained good, with recent selling prices achieved in the Atlantic Seaboard ranging from R6m to R15m to local buyers, and with interest in homes priced up to R29.5m.

"While it's true to say that in general buyers, cognisant of the rapid appreciation of properties over the past few years in particular, are resistant to overpaying because the marketplace is more competitive, the demand is definitely there and buyers are purchasing at the right price," he noted.

"The demand for gated, residential estates continues, and other, new opportunities are arising in the market through subdivisions and rezoning.

He added that while local buyers dominated the market in the Western Cape, the international outlook was also favourable.

"Our own PGP website sees a great deal of overseas investor interest - in the Cape Town area mainly in the R1.0m to R3.0m price range and in the City Bowl and Waterfront areas.

"Properties over R3.0m are also arousing overseas investor attention.

"In addition, interest among South Africans living abroad continues to grow rapidly, with many seeking second homes for holidays and/or investment.

"We also see increasing interest among parents living here looking to buy properties locally for their offspring living abroad - for use on their return after completing overseas studies or employment contracts.

"In this regard Cape Town's City Bowl is in high demand," he said.

In Cape Town's central city, PGP had sold approximately R550m in new residential developments or redevelopments resulting from the conversion of former office buildings into quality residential apartments, such as Mutual Heights, Cartwrights Corner, The Adderley Hotel Suites, Perspectives, 34 St Georges Mall and Mandela Rhodes Place.

In the Northern Suburbs, Joyce said homes priced from R1.0m to R2.0m were being snapped up immediately, with those well priced up to R3.0m also selling swiftly. In the Table View area, West Coast and Northern Peninsula were also attracting high interest among buyers.

"Given the current macroeconomic scenario, all the fundamentals remain in place for another buoyant year in the Western Cape property market.

"Capital appreciation of residential homes can be expected to continue, although somewhat more conservatively estimated at between 12% to 20%, depending on location, type of accommodation, and other variables," Joyce concluded.

© Christoph von Kalckreuth, Kapstadt, Südafrika 2005