There are an increasing number of companies from other countries in Africa as well as Europe who have set up major business operations in South Africa, says Michael Bauer, managing director of the estate agency IHPC.
“Johannesburg has more power businesswise but we have come across many people who do not want to live there and actually prefer to have their family home base in Cape Town and commute between the two cities instead,” said Bauer.
Because of this, he said, IHPC have decided to expand their operations to cover the City Bowl market and much of the Atlantic Seaboard, which property is particularly in demand from these corporates.
While most of these companies’ staff might be on contracts to be in South Africa for a certain amount of time, the theory is still there that most tenants will eventually become buyers and the areas of Camps Bay, Tamboerskloof and Oranjezicht has much to offer in terms of value for money and good location.
Bauer is the agent who will be operating in this area, working on sales of property as well as rentals. He has a background in property construction and home and interior decoration as well as initially working in the finance industry.
Bauer says that, in his experience, the prices of rentals have become very competitive, as well as finding stock. Most companies would allocate in the region of R15 000 to R25 000 per month (depending on the position of the staff member as well his family needs) but in most cases they have a healthy budget for accommodation, he said. This has been shown recently by the successful placement of a Swiss German couple in Clifton home within one week of listing the property on the market at the full asking rental for 24 months.
There are many German, Portuguese and French companies, many of which now have operations in Cape Town too, as they see South Africa as an entrance to the rest of Africa, and it is this growing market that IHPC will nurture and grow.
“At present in the City Bowl and Atlantic Seaboard, there is a long term rental stock shortage and if homes become available they usually tend to be taken up quickly. Surprisingly, there is also demand from students for this area. Usually parents spend between R5 500 to R8 000 (for two sharing) for apartments here, because of its central position and closeness to various means of public transport,” said Bauer.