South African estate agents, says Emil Weiss, the Rawson Property Group’s franchisee for Langebaan and surrounding areas, have often been only too quick to promote their areas as having excellent long term potential for property investors when this is possibly not the case. However, he says, such statements are decidedly true for the Saldanha/Langebaan region.
“I do not for one moment believe that the government are simply inflating optimism when they say that the new Saldanha Industrial Development Zone (IDZ) has the potential to attract R80 billion worth of investment over a 20 year period, of which roughly 25% will be contributed by the state and 75% by private enterprise. I also think they have probably got the figures right when they say that in the first ten years the new enterprises could provide up to 20,000 new jobs here.”
Weiss says that the area has been targeted as a base for offshore supply and major international marine repairs and those involved apparently have plans for increased beneficiation of iron ore, steel, ferro-alloys, titanium and zircon. Furthermore, oil and gas exploration operating from this area and moving northwards is likely to increase in the coming years. In addition, the zone has been designated as an area for renewable energy equipment manufacture, particularly wind blades.
“In one of the scenarios that I have seen,” says Weiss, “it has been estimated that foreign direct investment (FDI) will be close on R10 billion and that foreign shareholding in this area could be as high as 70% and the area could ultimately be supporting an increased population of 60,000 people.”
Obviously, adds Weiss, the roll-out of the IDZ programme is not going to have an immediate effect on property prospects at Langebaan. However, those considering buying now and looking for a long term, sure-fire investment should, in his view, definitely be targeting Langebaan, because not only are the prospects now good, but current prices are still exceptionally low.
“Anyone examining the recent sales figures, says Weiss, must become aware that prices here are still significantly below (perhaps 20 to 30%) what might be considered as ‘normal’ levels and at the same time it is quite clear that they have now stabilized. After only a very slight pick-up in 2012, for the first time in three or four years we have been fielding big inflows of enquiries over the December/January period.”
Traditionally, adds Weiss, this franchise has always had to wait until March/April for the ‘impact’ holiday tourist visitors to be felt.
The bulk of enquiries and sales, he says, are still definitely in the R800,000 to R1,5 million bracket. However, Langebaan’s R5 million beachfront and hilltop homes, some in very attractive modern designs, are also beginning to attract interest, although they are seldom put up for sale. Particularly good value now, says Weiss, are the many gated estates that have been developed north of the town towards Club Mykonos.
Examples of what he considers good value homes currently on his stock list, Weiss mentioned:
- A 310 m2 three bedroom home with its own small flat which has its own bathroom and kitchen. This is on a 697 m2 erf and is sited in the Langebaan Country Club, a very prestigious area. In addition to two family rooms and a living room (with a fireplace), the home has a study, a dining room and reception area. It also has an indoor gas braai and a separate braai room complemented by a Jacuzzi. The garden, fully enclosed by a wall, is automatically irrigated. The price for this home at R1,695,000 is less than one-third what a similar building in the Southern Suburbs of the Cape Peninsula would cost.
“This should surely give perspective retirees something to contemplate,” he says.
- Similarly, and also in the Langebaan Country Club, Weiss and his team have just listed a 120 m2 home. This is double storey and has three bedrooms, a living room and a dining room. The home has an upstairs braai on a balcony and attractive views of the lagoon. The price for this home is R1,530,000.
- Those wanting excellent value at Langebaan, says Weiss, should take a look at the empty stands. His team have over 200 on their books and they can be had for as little as R120,000. This means that the not too ambitious buyer here can, with the help of local builders, end up with a good value home priced at under R1,1 million or R1,2 million.
Although sales at Langebaan may be sluggish, rentals here, says Weiss, are escalating steadily, in his view at around 9 to 10% per annum. His franchise currently manages various properties and is finding that family homes with two, three or four bedrooms can achieve anything from R7,000 to R20,000 per month.
“We can more or less guarantee that any investor buying here will discover that from day one he can cover 50 to 65% of his monthly bond outlay on a 90% bond,” says Weiss. “Rents have already risen significantly and I believe will continue to do so.”
Spurred on by the much publicized potential of the area, estate agencies have been moving into Langebaan at an unprecedented rate: there are now 29 serving an area that has only 10,000 properties.
How can the potential investor choose from so many?
“The only advice that I can offer people interested in the area,” says Weiss, “is to check which agencies are staying open on Saturdays and Sundays. If they are keen enough to do that, they will in all probability be keen enough to go the extra mile on your behalf.”