Kloof, Hillcrest and Gillitts, traditionally regarded as ‘good’ residential property addresses, have held their values remarkably well, says David Hitch, the Rawson Property Group’s franchisee for Kloof and its surrounding areas – and, he adds, slight but significant price rises (in the 3 to 6% range) are now becoming evident. Particularly popular, he says, are homes priced under R2 million and those situated in gated security estates such as Plantations, Augusta and Kirklington.
“This year,” said Hitch, “the average price of homes in the area served by my franchise has been R1,8 million, which is almost double the national average. With 18 agents now working for us, we are averaging 10 to 12 sales per month, which is also significantly up on 2012. This rate, I believe, will pick up further in spring, as traditionally happens in this area.”
The improved outlook, added Hitch, should, however, not lead sellers to overprice.
“Regrettably,” he said, “overpricing has been all too common in this area, possibly because many sellers are not in a hurry to sell and often sellers do not accept the advice of reputable estate agents on these matters. Of the 400 homes on our stock list, a fairly large percentage, I estimate, are still priced above their current market values and are likely to stick on the market without selling for six months or more. If, however, the house is correctly priced, it will almost always sell in under three months and if it is in a security estate in four to six weeks.”
The area that we serve, added Hitch, is still known for its beautiful, large, expensive homes, often standing on extensive erven of 1,800 m2 to 10,000 m2, but although sales are taking place in this upper bracket (one of his agent has just sold a home for R5,5 million), the sales pace with expensive homes has not begun to speed up yet.
In this sector of the market, he said, the buyers still have the upper hand.
House values in Kloof, Hillcrest and Gillitts, said Hitch, will continue to be resilient because the area is strategically placed to serve not only Durban central (30 km away on the highway) but also, nearer to home, the proliferating Upper Highway commercial node (where many Durban businesses have moved to over the last decade) as well as the growing industrial activity in Pinetown, Waterfall and Cato Ridge.
Further reasons for the area’s popularity, said Hitch, are that being some 550 metres above sea level, year-round, Kloof is some seven degrees cooler than the humid coastal belt and all the areas he serves have maintained high architectural and landscaping standards. In addition, he said, the area also has half a dozen good private schools for both boys and girls.
Asked if there are negative factors likely to affect his agency’s road forward, Hitch said that, being an affluent area, Kloof and its environs attract many successful self-employed people. However, despite high incomes and substantial assets (which on principle are never taken into account by the mortgage lenders), self-employed people often have great difficulty in qualifying for bonds.
“I think a review policy is essential here,” said Hitch.
The much-publicised crime wave that at one stage seemed to engulf the area, said Hitch, has been successfully countered by additional security measures (including some very well organized neighbourhood watches) and has now ‘moved on’.
“With so much going for it,” said Hitch, “buyers should now be getting a foothold in the housing sector before prices and interest rates rise, as they inevitably will in due course.”