An outlook on the Cape property market in 2018
Category Property news
An outlook on the Cape property market in 2018
What does the property market hold for 2018? Here are a few predictions from Greeff Christies International Real Estate CEO Mike Greeff.
Although the country has seen a tumultuous 2017, the are some positive sentiments to note. December 2017 saw the successful election of Cyril Ramaphosa as ANC President. With his election the Rand surged to a 7-month high and slow signs of investor confidence began to filter in. This is indicative of a market correction that has been due for the past 5 years but has not made its appearance.
Traditionally there are some areas within the Cape Town metropolitan area that are star performers in the real estate market.
Taking top spot is the Cape Town City Bowl which is the fastest selling neighbourhood. On average property sold in approximately 36 days in 2017. This is almost three times as fast as the national average. The average price spend on property is approximately R3.9 million which is 15% higher than the previous year. Blouberg, where Greeff Christie’s International Real Estate has recently expanded to, comes in as a strong second place contender with a strong sales history. The Southern Suburbs also proves its worth with properties selling twice as fast in 2017 as they did the previous year. The Atlantic Seaboard is also worth looking at as the property value is likely to continue its upward trajectory.
Buying in 2018 should see an even greater push toward Sectional Title properties with developments being the first stop for first time buyers, empty nesters and investors. The appeal of secure living with the feeling of community is difficult to beat while an added benefit of the no transfer duty clause with new developments sweetens the deal. When combined with energy efficient homes, luxury fittings and added amenities then developments become almost impossible to ignore. This trend ties in with the current process of densification that uses land that was originally meant for one home for a few homes instead.
The current drought and water shortages in the Western Cape will definitely affect the way property is being viewed. Pools won’t necessarily prove as prohibitive as expected with buyers expected to be more concerned about the size of gardens and lawns as well as the availability of a borehole on the property. Buyers are also expected to be more focused on smart features and fittings on potential homes before buying with the move to energy and water efficiency becoming higher priority than ever before. Homes with existing rain tanks and smart landscaping should also receiving a lot more attention.
The election of Cyril Ramaphosa as ANC President will also provide added stability to the South African economy with foreign investors seeing him as a business-friendly option. While Ramaphosa’s election might not be able to reverse South Africa’s junk status with international lenders, it should do enough to lessen pressure on South Africa to increase interest rates thereby providing much needed relief to citizens. The most immediate step in the right direction is the scheduled drop in fuel prices.
This should have a knock-on effect on the rest of the economy. While interests rates are expected to remain unchanged banks will no doubt continue being very stringent on credit history when individuals apply for a home loan.
This should have a knock-on effect on the rest of the economy. While interests rates are expected to remain unchanged banks will no doubt continue being very stringent on credit history when individuals apply for a home loan.
Author: Greeff
