MANY BUY WITHOUT HOME LOAN

MANY BUY WITHOUT HOME LOAN

Category Property News

AFFORDING to buy a home these days is a difficult, if not impossible, task for most South Africans. But many are accomplishing this without the assistance of a home loan. Calculations using Lightstone data show around 35% of properties pur chased in the past 12 months was bought with cash. Citing the data, Just Property chief executive Paul Stevens says 233 841 property transfers took place in the past 12 months, but only 153 255 bonds were registered. The rest, therefore, were cash purchases. Of the four biggest provinces, three show similar stats relating to cash purchases. In the Western Cape, 41% of transfers were cash deals, while in KwaZulu Natal and the Eastern Cape these deals accounted for 42% and 44% respectively, he says. "Gauteng lags at 22%." Most cash buyers are investors, agents say. Cash is king in the Cape Winelands, where the majority of recent sales were purchased without a bond, says Chris Cilliers, chief execu tive and principal Lew Geffen Sothe by's International Realty there. The most sought after properties in the region are Paarl estate homes, premium new builds in Somerset West, and houses in the more exclusive Stel lenbosch suburbs. "In a buyer's market a cheeky cash offer can be tempting to a motivated seller." Cilliers says sawy investors appre ciate the value to be found in the cur rent economic climate and recognise now is the best time to buy low, rent out and wait for the market to climb again. "A fair amount" of cash buying is also being seen in the City Bowl and Atlantic seaboard, says Leon Lombard, sales manager at Rawson Properties, for both residential and commercial properties. Cash buyers in these areas are mostly looking for renovation projects and are forking out between R3 million and R10m. "We had a commercial cash sale of R4m to Joburg buyers," he says. In high demand western Seaboard suburbs, roughly 25% to 30% of all sales are cash purchases, says Century 21 principal Tamara Nettmann. Those who are buying with cash are purchasing homes in estates or complexes, and paying R3m to R4.5m, she says. Greeff Christie's International Real Estate is seeing a "significant" num ber of cash sales across its operation areas, says chief executive Mike Greeff. From February 2018 to February 2019 Kommetjie saw the highest percent age of cash sales, with 84.6%. This was followed by the southern Suburbs with 61.56%. Simons Town is "on the fence" with 50% and the area with the lowest percentage of cash buyers is False Bay with 40%. "The majority of the properties sold is in the lower and middle of the markets, with many sectional title properties and full title homes. There are also a few high end properties changing hands via cash sales." Greeff says cash buyers are pay ing from R800 000 to R5m and they include investors buying for resale or renting out, or residential buyers who have already sold their homes. In the City Bowl, which is increas ingly seeing high value sales, Ross Levin, director for Seeff Atlantic Sea board, Waterfront, and City Bowl, says most were cash deals. In Knysna about 50% of sales are cash, says Century21's Theresa Marais.

Author: Lew Geffen Sotheby's International Realty