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Diversity drives Somerset Wests market strength
Category Property News
The erstwhile sleepy village near Cape Town has blossomed over the past decade, and Somerset West is now a thriving economic hub and one of the most sought-after residential areas in South Africa.
Chris Cilliers, CEO and Principal of Lew Geffen Sotheby’s International Realty in the Winelands, says: “Unlike most areas around the country, demand for property across all market segments in Somerset West has remained high, with investor interest from a broad demographic driving a buoyant market that remains largely unaffected by current economic trends.
“Aside from myriad drawcards which tick most boxes on buyers’ wish lists, Somerset also has a wide choice of property options, catering to everyone from first time buyers on a tight budget to millionaires seeking trophy homes.
Says Cilliers: “It’s still possible to get a foot in the market for as little as R500 000, which buys an older flat in need of a little TLC or around R1m for a small two or three bedroom house, often in a complex.
“Sectional title and townhouse prices range up to R3,5m, modern homes in secure estates vary between R3m and R9m and free-standing houses can be bought across the price band spectrum, all the way up to R30m for a luxurious home on generous grounds with top-of-the-range finishes.”
Once dominated by free-standing homes with a limited choice in sectional title property, Somerset West’s residential component has changed dramatically in recent years and now offers an eclectic mix of traditional older homes, modern houses, sectional title townhouses and secure residential estates.
Cilliers says that although the local market is very active with ongoing repeat sales from current residents who are upgrading or downsizing, up to 40% of current investors are from Gauteng and other parts of South Africa and these buyers favour homes in secure estates.
Between April and June this year, 68 properties changed hands to a combined value of just over R96,5 million. Of these, more than half (48) were estate homes with 21 units being in the R1,5m to R3m price band and 20 in the R800 000 to R1,5m bracket. Only four properties were priced below R800 000 and three above R3m.
“There is no doubt that up-country buyers are significantly spurring market activity, and the number of new estates and retirement developments are testament to this burgeoning demand.
According to Cilliers, there is also a very large international contingent, predominantly buyers from Germany, Switzerland, Belgium, Holland, the UK and Scandinavia, many of them “swallows” spending the northern winter months in South Africa, where it’s summertime.
He adds that the rental market is also extremely active with a huge demand for family homes, especially near good schools. However, there is a shortage of quality rental properties, as up to 80% of investors buy property to live in themselves.
Lew Geffen, Chairman of Lew Geffen Sotheby’s International Realty, says that the rampant residential development has also sparked extensive commercial growth to cater to the growing population.
He says: “In addition to Somerset Mall, which has expanded to include smaller satellite malls, shopping centres and offices are popping up to service the newer outlying areas of the town and the new residential developments along the N2 also include commercial and industrial components.
“The old AECI grounds, now called Paardevlei, are in the process of being developed into a self-sustaining “town” with residential, commercial, industrial areas as well as facilities, and a massive development is also in the pipeline for Sir Lowry’s Pass Village.”
Geffen adds that several new schools, including Reddam House, and the introduction of excellent sports facilities such as cycling and running tracks and outdoor gym stations are also adding to the area’s appeal.
“There are also world-class medical facilities right on their doorstep and the airport and Cape Town metropole are less than 50 km away.”
Cilliers says despite exponential development, Somerset has maintained its country feel and still offers a relaxed lifestyle in spectacular natural surrounds.
“Situated at the base of the Helderberg mountain range, residents enjoy easy access to pristine parks, nature reserves, renowned wine estates and several beautiful beaches, most within a 15-minute drive.”
Author: Lew Geffen Sotheby's International Realty