The Parow Valley and Parow residential market is still very attractive to large numbers of upwardly mobile middle class residents (and a few downscalers) who cannot afford most of the south and central Cape Peninsula home prices.
Although the area has its fair share of R1 million to R1,3 million homes, said Alvin Suklall, the Rawson Property Group’s franchisee for Parow Valley and the surrounding areas, the majority of homes here are selling for between R750,000 and R950,000 and this is seen by many people as affordable. Furthermore, he said, prices in the area have shown a remarkable tendency to be stable despite the quite severe dips of 2008/2009 and much of 2012.
Giving an example of just how prices have risen, Suklall mentioned a home which he recently valued at just over R1 million. It is important to note that this home was sold originally in 2002 for R330,000.
This year prices have increased by 5% to 6% per annum.
The relative stability of home prices, added Suklall, has unfortunately had one regrettable effect: there is still a tendency among large numbers of sellers to overprice their properties. Recently, he said, he gave a valuation of R700,000 on a home, for which the owner then refused to accept a sales price below R950,000, making the home, in Suklall’s view, completely unsellable. This kind of situation, he said, does happen quite often in areas where the majority of homes are priced below R1 million and this always provides the agent with difficulties.
What is often an even bigger challenge than persuading clients to accept the valuation, added Suklall, is that, again as in many areas where the price bracket is similar to his, potential buyers do require a fair amount of ‘financial education’. All too often, he said, they are unaware of the National Credit Act and the impact it has had on bond awards. They are often also unaware that in most cases a deposit will be required and very often, too, they do not realise that a purchase of this kind involves extra costs such as transfer fees.
“With many of the buyers who come to us,” said Suklall, “it soon becomes obvious that they have no deposit at all and expect a 100% or even a 110% loan – which a check on their credit rating by the bank will automatically rule out.”
Due to the fact that so many potential buyers do not ‘make the cut’ with the banks, the demand for rental properties in Parow Valley and Parow, said Suklall, is at an all-time high and this why his franchise, some two months ago, diversified into the rental market. Today, he said, a typical three bedroom home will probably rent for between R5,500 to R6,000 here and a two bedroom flat will be priced around R4,500.
Those deterred by, what many buyers see as, the higher prices of Parow and Parow Valley, added Suklall, should take note that adjacent suburbs such as Elsies River, Ravensmead, Valhalla Park and Bonteheuwel have all proved to be good stepping stones on the move up to Parow and Parow Valley and here homes can be valued at anything from R200,000 to R500,000.
Asked to give examples of well valued homes on his stock list, Suklall gave the following:
- A three bedroom home in Matroosfontein with one bathroom, a garage, an alarm system, burglar bars and security doors for R475,000.
- A four bedroom, two bathroom home in Charlesville which has a garden, an open braai area and a swimming pool for R775,000.
- And a well-finished three bedroom house in Parow Valley with two bathrooms, an alarm, an automated garage, burglar bars, security doors, security fencing and a swimming pool for R1,2 million.