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Thursday Feb 28, 2013

Southern Suburb property sales depend on price bracket

Southern Suburbs apartments below R750,000 are in high demand, and houses below R1.4 million also sell quickly. But properties in the upper bracket are languishing.

There is also some movement in the R2m to R3m segment of the market, says Garth Stroebel of the local RealNet franchise. "But the required deposits are becoming steep at a time when there is not much cash floating around."

"Overpricing in this segment remains prevalent and offers are indeed being made at 10% to 15% below asking prices in the more affluent areas of Rondebosch, Kenilworth, Claremont and Newlands."

He says sellers should follow the example of those in the lower price range.

"Accurately pricing properties from the word go means they will sell quickly, as evidenced by rapid sales in this category. Unfortunately, there have been cases of beautiful upmarket properties languishing on the market for nearly a year at prices between R5,9m and R9,5m, only to be sold promptly when the owners dropped their prices, in some cases by as much as R1m."

Other property in hot demand includes apartments in areas such as Plumstead, Wynberg and Diep River, at prices between R550 000 and R750 000.

"But finding stock of secure apartments in the Rondebosch, Rosebank and Mowbray areas is like finding a pot of gold," he says.

"These areas are always in high demand among buyers who have children studying at the University of Cape Town and surrounding institutions, and units in good condition with two bedrooms typically sell at prices of between R800 000 and R1m. Investors are also drawn to these areas - a unit here represents a great investment because of the perennial demand among parents looking for student accommodation to buy or to rent."

Proximity to schools also remains a dominant factor in the Southern Suburbs, he says, due to high transport costs and boarding fees and the "horrendous" traffic congestion that has become the norm.

RealNet Press Release

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