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Camps Bay property market surge
Category Property News
One of the most dynamic markets on the Atlantic seaboard last year, Camps Bay reached the highest rand values of single residential houses sold since 2007.
Excluding several as yet unregistered sales from late last year, a total of 319 units were sold for a new record amount of R3.121 billion during 2014, compared to 2007 when a total of 525 units were sold to the value of R2.737bn.
Camps Bay is just one if the suburbs where indicators show that the residential property market in Cape Town is finally back on the boil after a slow recovery from the market crash of 2008, only gaining momentum again in 2012.
Recently released statistics reveal massive price surges in several areas, particularly on Atlantic seaboard, and high sales volumes in neighbourhoods with easy access to the city centre.
According to Lew Geffen, chairman of Lew Geffen Sotheby’s International Realty, one of the main reasons for this market surge is return on investment.
“Property investment in Camps Bay has always been lucrative with consistent and healthy returns, but the recent recovery of the market has resulted in the price band from R10 million to R20m improve by 138 percent over the past seven years, which is a substantial leap and a very attractive investment option.
“Although the suburb has always been a good investment it can only become a more attractive option as available land for new development is limited and increased demand and limited stock will drive the prices even higher. And, with its exceptional position, unparalleled sea views and proximity to the city, it offers a lifestyle unlike anywhere else in Cape Town.”
Brendan Miller, chief executive of Lew Geffen Sotheby’s International Realty on the Atlantic seaboard, says that the demand for family homes, particularly in the R5m to R8m price band, has increased with younger buyers wanting to upgrade to this sought after suburb.
“We are finding that properties in this price range are quickly snapped up and sale stock is scarce across agencies.”
Thelma Sandeman, agent for Camps Bay, says because the suburb is older and established, a large percentage of buyers look for unrenovated homes in good positions, which they generally knock down the second the deed of sale has been registered.
“A lot of the ‘old’ Camps Bay is disappearing, making way for modern luxury homes that are either permanent homes, or lucrative rental investment properties that rent for anything from R3 000 a day out of season, to more than R30 000 a day in season.”
Edith Marsh, another agent, says the apartment market has also increased exponentially, with lock-up-and-go options becoming increasingly desirable.
“Gauteng and overseas buyers especially are snapping up these properties, mostly as second homes or for short term holiday rentals which yield high returns.”
In 2014 a total of 45 flats were sold worth R221m compared to 27 units to the value of R105m in 2012. Many apartments in Camps Bay are still very reasonably priced and popular buys during 2014 were apartments in The Crystal and The Glen where buyers paid from R47 000 to R50 000/m2 for apartments with floor areas of between 80m2 and 138m2, whereas many of the new developments with luxury finishes and amenities are heading for R70 000m2.
The adjacent suburb of Bakoven was often considered a part of Camps Bay, but in recent years has begun to establish itself as a sought-after suburb in its own right, recording a healthy average annual nominal return of 15 percent for the past 12 years.
And as a result of extensive development in the area in recent years, Bakoven’s apartment market has shown spectacular growth with an all-time record in rand value of apartment sales recorded during 2014.
Geffen says that since the beginning of 2013, the apartment market in Bakoven has doubled in terms of rand value and average value.
“In 2013 a total of 25 apartments were sold to a combined value of R108m with an average value of R4.325m, and the same number of apartments was sold in the first 10 months of 2014 at an average value of R8.4m.”
Miller believes the increased demand for accommodation in excellent positions has resulted in this high growth in the rand value as well as average values.
“With limited space for future developments in Bakoven Bay it can be expected that existing apartment prices will enjoy further upwards growth in price.”
Author: Lew Geffen Sotheby's International Realty