Urbanites are leaving the City Bowl 🔴
Category Property news
Urbanites are leaving the City Bowl 🔴
The Covid-19 health crisis drove many South Africans to stay home for several months due to safety and regulatory reasons last year. This disrupted the lives of millions of people, especially those who lived in apartments, thus being deprived of any open or outside space. As a result of this, Greeff Christie's International Real Estate has noted an interesting phenomenon persisting: more and more people continue to leave areas such as City Centre to move to smaller localities along the coast.
Many city dwellers have chosen, at the expense of their city life, to move away to areas and homes with much more space than they could have previously claimed. The attractiveness of the city, which had participated in a very important rural exodus in the time of our ancestors, seems to be reversed to give way to a new era of urban exodus where people now prefer space and comfort over the conveniences that city life has to offer.
Several reasons for this trend are:
- The growing desire of many people to access a higher level of comfort at lower prices. This includes larger, quieter and more secure indoor and outdoor spaces.
- Families looking to be closer to their friends and family, who play an important support system role in their lives.
- The restriction and closure of access to certain stores, restaurants and workplaces that made living in the city pleasant and profitable for young homeowners and tenants in particular.
- The various financial difficulties caused by the economic crisis that has impacted the majority of households (loss of employment, reduction of activity). These difficulties prevent anyone from maintaining the standard of living they had before.
The restrictions on movement and gatherings imposed by the government, not only in South Africa but around the world, have shown that not all work-related travel is necessary and that telecommuting can often be just as, if not more, effective. Many young people are therefore struggling to justify paying high rentals or investing in a comparatively tiny city property for the benefit of being closer to their work.
Telecommuting now allows more people to live outside of the city where they will pay less for a property that is larger and more comfortable than what they would have been able to afford in the City Bowl, all while maintaining the same income.
Today's very low interest rates also make it possible for young remote workers to buy their own homes instead of renting, especially if they move out of town where prices tend to be lower. This trend has also been one of the triggers for investing in real estate observed by Greeff Christie's International Real Estate.
Although the debate amongst economists globally as to whether the 'counterubranization' trend will endure is still ongoing, the conventional belief that small city properties, such as the apartments and small houses found in City Center, make for good long-term investments still holds true for a number of the purchasers whom we are currently working with.
Amidst the low-interest-rate environment, we have seen a healthy demand from first-time purchasers for well-priced properties in the City Bowl. Whether this demand is a result of these purchasers seeing genuine value, or whether it is just leftover hot air attributed to the 'cheap money' supply offered by banks to novice investors buying for speculative purposes, is yet to be seen.
With the Reserve Bank already hinting at interest rate hikes in the near term, many sophisticated investors and homeowners who have been considering their options are electing to take advantage of the current window of opportunity to put their properties on the market while selling conditions are still favourable.
If you're looking for further advice, more insight into the market or potentially looking to sell, click the button below and one of our area specialists will be in touch with you.
Author: Greeff Christies International Real Estate
