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Prices of secure estate properties in Cape Towns Southern Suburbs Skyrocket
Category Property News
The increasing demand for secure estate living in Cape Town’s southern suburbs, compounded by the lack of available space for further development, has created a seller’s market where sale prices in excess of R10 million are now being realised in popular estates like Stonehurst and Silvertree.
Dave Burger, agent for Lew Geffen Sotheby’s International Realty in the Constantia Valley and Tokai, says the increased demand can be directly attributed to the relaxed lifestyle that these secure estates offer.
“Personal safety and protection of assets are foremost on people’s minds and you simply cannot put a price on the peace of mind of knowing loved ones are secure. In areas such as the Constantia Valley, where primary breadwinners frequently travel extensively on business, this is a key factor.”
He says another reason people are preferring estate living is the high cost of maintaining large properties in terms of upkeep, staff and ever increasing property rates and taxes.
“In Stonehurst and Silvertree the average price of our last 20 sales was R6.7m with the price a square metre just over R20 000.”
Brenda Pretorius, who works alongside Burger, says sales at these two estates have increased exponentially in the past two years.
“R80m worth of property was sold in 2013, more than doubling last year to just under R180m and in the first quarter of 2015 properties worth around R100m have changed hands, so this is likely to be a record year.”
Burger says: “Average price increases at certain estates like at Silvertree and Stonehurst over the past two years have been between 15 percent and 18 percent, and at other estates such as Silversteen and Steenberg Golf Estate, there has been very little movement.”
He attributes this to unrealistic seller aspirations coupled with the high monthly cost of municipal rates and levies at these estates, which are around R10 000 a month.
“This is more than double what is paid at other estates,” he says, “placing these properties in the domain of wealthy individuals.”
Currently, the most popular are the entry to mid-level properties, which are snapped up by couples wanting to invest in a secure environment close to good schools.
Pretorius says that at some estates like Nieuwe Steenberg, a fairly new entrant to the market, the smaller units selling for around R4m were quickly sold while the units priced above R10m have been slower to move.
“Demand is beginning to outweigh supply and, apart from Stonehurst and Nieuwe Steenberg where a handful of stands are still available, there are no new developments in the area at this stage and people want to live securely, so the listing prices will be achieved.”
According to Burger, Stonehurst is the only estate in the area with potential to “build your own,” affording buyers the opportunity to design their dream home.
“Depending on materials and finishes, you can build a 400m² home for about the same price as you can buy, the advantage being that your personal tastes can be fully realised, but there are stringent design constraints in place on all estates to retain the aesthetic value.”
Lew Geffen, chairman of Lew Geffen Sotheby’s International Realty, says that the lion’s share of the market remains local, with around 25 percent of sales going to foreigners and SA citizens who have worked offshore and accumulated capital returning to live in one of the world’s most desirable cities.
“Investors in secure estate living tend to be locals moving from larger properties to a secure environment, young families entering the market and Gauteng buyers seeking the Cape lifestyle.”
Author: Lew Geffen Sotheby's International Realty
