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Thursday Jul 09, 2020

No freeze for property market in Jo'burg

It seems that the Covid-19 hard lockdown in April and May applied only a temporary brake to rising property sales in both the northern and southern suburbs of Johannesburg, where the Chas Everitt International teams in Hyde Park, Sandton, Randburg, Glenvista and New Developments have sold more than R500m worth of property in the past three months.
"Business in the northern suburbs has been really brisk in the past six weeks," says Rory O'Hagan, principal of the Hyde Park & Sandton office, "and our sales worth a total of around R300m have included about R130m worth of homes in the luxury R5m to R20m price range.
"Hyde Park, Bryanston, Riverclub, Illovo and Dunkeld West have been our busiest areas and while things are admittedly slower in the super-luxury bracket, which includes homes priced at more than R20m, we have concluded some sales in this range since March, including one for more than R35m."
The New Developments team has also notched up a steady stream of purchases over the past three months in developments such as Aurora in Hurlingham, The Emerald in Hyde Park and Maya in Parktown North, at prices ranging from R2,6m to around R4,5m.
Meanwhile recent sales for the Randburg Chas Everitt team include a Northcliff home sold for R13m after having been on the market for nine years.
And in the southern suburbs, the Glenvista team has just notched up a R15,5m sale of a home in the Malbank Estate on the Vaal River to round off its best sales month in more than two years.
"Sales in the south have also picked up rapidly since the sharp interest rate decline in May," says co-principal Allan Hunkin, "and this pushed the total value for the second quarter to R93m, with the bulk of deals being done in June. This is quite remarkable when you consider that our average sale price is only around R1m and that a large percentage of our buyers are first-time buyers who often don't have the cash for a deposit and must obtain a 100% home loan."
Chas Everitt International group CEO Berry Everitt expects the Johannesburg residential market to continue to benefit in the third quarter from both the partial re-opening of the economy and the fact that many affluent individuals who were planning to emigrate, or to semigrate to the Cape, have had to put those plans on hold.
"In fact, almost 7% of our sellers withdrew their homes from the market in June. This underpins prices by keeping supply and demand in balance. On the demand side, the current volatility of the equity and bond markets is driving many investors to move their money into real estate, and more particularly into high-end rental units in suburbs close to the Sandton financial hub.
"But buyers have caught on that due to a combination of key factors, there are actually excellent property investment opportunities in most price categories now. In the under-R1m bracket, for example, home prices are generally about 6 to 10% higher than they were a few years ago, but the steep decline in interest rates this year means that purchasing is now much more affordable, especially for first time buyers.
"And in the R1m to R2,5m and R2,5m to R5m price categories, home prices are currently back at around 2016 levels in many areas, making it much easier to upgrade into these categories, especially if you are a repeat buyer with a decent deposit."
Chas Everitt International
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