Errol King, franchisee for the Rawson Property Group’s Muizenberg franchise, has gone on record recently as saying that homes in the Marina Da Gama development are still exceptionally undervalued and represent some of the best long-term residential investments available to local and overseas buyers.
To support this statement, King and Rawson Property Group head office staff recently did research on waterfront and marina properties worldwide – and this, said King, gave ample evidence that almost without exception such properties are sought after and tend to be valued at anything from 50 to 100% more than other similar properties in the area.
“By the time we had noted the prices of over 200 properties, there was no longer any doubt that people seem to like living near water and are prepared to pay a premium to do so,” said King.
Among the areas looked into were those in Stockholm, Paris, La Rochelle, Marseilles, Montpellier, Costa Brava, Naples, Lisbon, Crete, Hamburg, Sydney, Perth, Vancouver, Quebec, Chicago, Long Island (New York), Miami, Canary Wharf (London) and South Africa’s own highly successful Victoria and Alfred Waterfront.
“In many cases,” said King, “and this is certainly true of Marina Da Gama, the original developers lost money because the concept was not fully understood or appreciated and they went in too boldly with overdevelopment in the early phases, making it impossible to recover their investment. However, the subsequent owners have almost without exception then found themselves with a valuable, fast appreciating asset. In Canary Wharf, for example, millions were lost in the initial stages – but today few areas in the UK were less affected by the recession and the average price of a freestanding home in Canary Wharf is now at £550,000, while semi-detached and furnished apartments are selling at around £400,000. These prices are more than double the average home price of £163,000 — however, this figure does include the extremely high priced areas of Central London’s Kensington and Chelsea, Greater London’s Wimbledon and extremely low priced areas such as Liverpool and West Yorkshire.”
On the Sydney Waterfront and the Hawkesbury River, said King, houses can sell for between Aus$1 million and Aus$2 million — some waterfront suburbs median price can get as high as Aus$7 million. On the Chicago Waterfront, which now extends 18 miles and takes in properties on Lake Michigan and the Chicago River, property prices are from US$350,000 to US$3 million – which is well above the city’s average home price of $155,500. Crete, the most populous of the Greek islands, offers waterfront properties with values of up to €3,000,000, when the average home price in Greece is a mere fraction of this.
“As cities expand,” said King, “the popularity of marina and waterfront areas grow. Muizenberg’s Marina Da Gama, developed by Anglo-American with superb Cape vernacular architectural guidelines, set up by Revel Fox, has been widely praised for the excellence of its original concept, but it is only now beginning to be fully appreciated.”
In 2007, said King, the average price of a home at Marina Da Gama was R998,000, with on-the-water homes selling at roughly double that. The recession then knocked R160,000 off the average price and today it is still only R1,157,000. However, he said, these eminently attractive prices cannot last forever.
“Prices are now rising, we estimate at around 12% per annum, and the low price scenario that has prevailed until recently will not, we believe, last much longer. Now, therefore is the time to buy at Marina Da Gama, as some people seem to be realizing. Already this year there have been 26 sales and we believe that this figure will double by the end of the year.”
The Deeds Office statistics, added King, reveal that Marina Da Gama has a very stable population, with 60% of the residents having lived there eight or more years and 40% having lived there over 11 years. This, he said, indicates that once people move to Marina Da Gama they are reluctant to leave, as they have bought into a lifestyle and have often waited years to find the perfect home on the marina.
King said that on-the-water Marina Da Gama homes with three or more bedrooms now rent from between R8,000 to R15,000 per month, while those off-the-water can achieve rentals of R4,500 to R10,000 per month.
“In both cases,” he said, “we have seen a rise of 30% in the last two years and with demand on the increase these rents will continue to rise.”