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Monday Nov 03, 2014

Clifton sales near pre-recession values

The property market in Clifton - dubbed the richest strip of residential real estate on the African continent - is again nearing pre-recession sales values, with property worth more than R450 million sold this year.

Real estate agencies said this week the total value of sales in the first 10 months of this year was higher than any year since 2008, when the world economic recession drove down property prices worldwide.

While the price of houses and flats in the wealthy Atlantic Seaboard suburb has remained relatively stable since 2012, more sales this year meant the total value of property transactions in Clifton was already R50m more than the whole of last year.

Seeff luxury market specialist Lance Cohen said demand for property near the suburb's popular beaches was so high that late last year a buyer paid R17m for a bungalow on a 178m plot near Second Beach in order to demolish it and build a "dream villa".

Cohen said it was now rare to find a house priced at less than R20m.

PropStats, the sales database of the Institute of Estate Agents of South Africa, said the highest value sale this year in the suburb was for three adjacent pieces of vacant land of 2 500m on Victoria Road, Seeff sold in January for R70m.

The next month the agency sold a house on a 688m2 erf for R55.8m.

With no room to expand, limited supply has for years kept prices high in the relatively small suburb of just 231 houses and 423 apartments.

Cohen said that even vacant plots of land were in demand, selling at between R40 000 and R60 000 per square metre.

So were garages, especially on Victoria Road, the suburb's main thoroughfare that links it to the affluent suburbs of Bantry Bay and Camps Bay.

In April two garages on Victoria Road, with a combined floor space of 38m were sold for a total R3.5m.

This means garages may be more expensive than the cars they house.

Basil Moraitis, the Pam Golding Properties area manager for the Atlantic Seaboard and City Bowl, said it was not unusual to achieve in excess of R100 000 per square metre for beachfront property.

"Clifton is currently a sellers' market - (with) an acute shortage of stock for sale."

From an all-time high of more than R600m in sales in the 2007 boom year, total sales in Clifton dropped to less than R300m in 2009 in the global recession's wake, according to property data analyst company Lightstone.

Sales picked up again in 2010.

RE/MAX property consultant Rainer Kloos said the entire Atlantic Seaboard, including Clifton, remained popular with foreign buyers.

He said the fairly common perception that foreigners paid more for property - thereby driving up prices - was false.

"( Foreigners) have more money to afford higher-priced properties, but certainly do not pay more.

"On the contrary, they are usually extremely astute with their buying decisions."

Seven properties in Clifton worth a total R150m have been sold to foreign buyers this year, mostly British and French nationals.

Real estate agencies generally credit a "perfect storm" of factors for the suburb's desirability.

In addition to panoramic sea views and easy access to beaches, restaurants and trendy caf├ęs, the area is protected from the prevailing strong summer south-easterly winds.

And then there is location, location, location - the suburb's name is a strong selling point. "(It is) our very own version of St Tropez," one estate agent said.

Weekend Argus (Saturday Edition)


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