Anyone selling residential property in Mitchell’s Plain, the vast precinct close to the Cape Peninsula’s False Bay coastline, will be aware of the dynamics and many unusual factors that influence this market.
Explaining some of these recently, the Rawson Property Group’s franchisee for the area, Michael Feltsman, and his new manager/partner, Gavin Judd, said that the first factor to be appreciated is the size of Mitchell’s Plain. 26% of the inhabitants are backyard dwellers and this presents an opportunity to sell to prospective clients who are fed up with being on the waiting list for council property.
“Covering such a large territory,” said Judd, “it is unlikely that any one agency can serve all sections equally well. This is one of the reasons why we have concentrated on the middle income bracket.”
Secondly, he said, agents serving Mitchell’s Plain have to appreciate how powerful family ties are in this part of the Cape. Wherever possible, people will choose to live near their relatives and in some areas as many as four or five related families can be found within one kilometre of each other.
Furthermore, although currently there is no shortage of stock here, in general, said Judd, the turnover in homes is slow by South African standards: a home here may change hands only once or twice in 30 years – but, despite the perception among some members of the public that the area is severely troubled by gangs, relatively few Mitchell’s Plain home owners or tenants ever leave.
Another reason for this, of course, is that prices here are low by Cape Peninsula standards. Home owners are more likely to upgrade in Mitchell’s Plain and this, say the Rawson Property Group staff, is an on-going process.
“For example,” said Judd, “a family will sell their home in Beacon Valley for ± R300,000 and then buy in Westridge for R450,000. In Mitchell’s Plain this is considered a big step upwards.”
These on-going upgrades, he added, are quite likely to benefit from the fact that many Mitchell’s Plain home owners, having bought several years ago from the original developer, the City Council, now have paid off their homes in full.
“As a result of this,” said Judd, “we see some buyers able to put down 60 to 70% deposits.”
All buying and selling in Mitchell’s Plain, he added, can be complicated by the problem that those who bought several years ago from the City Council, and may well have paid paid in full for their homes, at no stage received legal transfer documents.
A further fact influencing home values here, said Judd, is that while freestanding homes are much in demand, semi-detached units are less popular today.
In general, although prices in Mitchell’s Plain can rise up to the R850 000 mark, in the more sought after suburbs, such as Colorado and Strandfontein, the vast majority of sales still take place in the R180,000 to R550,000 bracket, with R350,000 being the average price. It must be remembered, too, that this is the price of a freestanding home – Mitchell’s Plain has very few sectional title units. Most prices, say the Rawson Property Group staff, are now 9 to 10% up on those of June last year and demand, they believe, is strong enough to ensure further rises of this size in the year ahead.
On the rental side, the increases this year have been equally impressive, e.g. from R3,000 to R3,500 and in R4,400 to R4,800 in less than a year. Such rent increases, said Judd, are as always attracting buy-to-let investors.
In these strong demand conditions, most agents, said Judd, are finding they can raise their sales and turnovers. At this franchise the agents have been particularly motivated by the targets they have been given for each month and for the year. The franchise is now selling five to six homes per month and by the end of this year they predict the total sales figure will exceed 100. This is nearly five times the figure achieved by this franchise in 2013.
“It is very pleasant indeed to be working in a recovering, near-boom market and, in addition, to find that our move to the Rocklands Mall as well as the strong branding of the Rawson Property Group are helping to boost sales,” said Feltsman.