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Monday Mar 01, 2010

Western Cape property sales rise but prices stay flat

The January figures from PropStats, the Western Cape Institute of Estate Agents' monthly statistical review (available to agency principals and managers), give further encouragement that the Cape residential sector's recovery is gaining momentum.

More than R1 billion worth of confirmed sales were reported by the 160 offices now supplying PropStats with data, says Annette Evans, the manager of PropStats.

Confirmed sales are those on which the sales agreement has been signed and all the conditions have been met, and the bond has been granted - if a bond was required - so the transfer is able to go ahead.

Significantly, says Evans, the average sales price has not yet risen much, although sales are definitely on the increase. The average sales price in January was R1.7 million, with most of the activity taking place in the Parklands, Table View and Blaauwberg areas, where the average price was R1.1m. The Atlantic seaboard, excluding Hout Bay, achieved an average of R4.5m.

Evans believes most agents now expect a 5-10 percent upswing in prices before the end of the year. This confidence, she says, is based at least in part on the fact that the achieved prices are now on average within 10 percent of the listed prices and the time it takes to sell a property is dropping to as low as between 80 and 90 days, which is a real indicator that buyers are more keen to get back into investing in property once again.

"As I see it," says Evans, "the chief limiting factor now is simply the banks' ongoing difficulties in financing bonds: in January, almost 50 percent of the sales were to cash buyers, whereas in more 'normal times' the figure used to be under 15 percent. The impression in the industry is that only 25 percent of bond applications are now successful."

Weekend Property supplement (Saturday Argus)

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