The residential property market in the Richards Bay area in KwaZulu-Natal is experiencing a shortage of stock in general, reports Phil Hammill, area principal for Pam Golding Properties.
“Activity in the market has picked up noticeably since October 2013,” he says. “Townhouses, simplexes, duplexes and freestanding houses mainly in the price range from R600 000 to R1.7 million are most in demand among both local purchasers and those relocating here from other areas and regions.
“These include families and career-minded young people, with the common denominator being their focus on achieving value for money. We find the four major suburbs of Meerensee, Birdswood, Arboretum and Veld en Vlei are the most sought after, due to their accessibility to the CBD and places of work, status and relatively low crime.
“As today’s buyers are placing a high priority on obtaining value for money, a renovated property in Arboretum, for example, is considered more attractive than a standard house in Meerensee. Further to this, while the standard three bedroom, two bathroom home with double garage which is priced around R1 million to R1.3 million is in demand, we have recently seen an increase in enquiries for higher priced houses over R2.5 million – mainly from local buyers.”
Well priced, appealing homes sell in a week
Hammill says despite the shortage of properties, home buyers are well informed and as a result over-priced properties remain on the market, with well-priced, appealing stock selling even within one week.
“We find that a large percentage of purchasers prefer the convenience of lock-up-and-go homes, mostly priced between R600 000 and R1.2 million, with buyers a mix of younger people, small families, contract workers and business executives.
“Meeting buyers’ key requirements for good location, pricing and security, these properties include homes in developments and in established and popular estates such as Pride Rock, Olive Sands, Kashmir Gardens, Richwood Gardens and Turtle Bay – situated in the CBD, Birdswood and Meerensee, as well as properties in Mzingazi Golf Estate and Mzingazi Waterfront developments.”
He says on the golf estate, which is now 60 percent developed, property values have appreciated, achieving growth of some 30 percent over the past three years in total – particularly in regard to newly built, freehold homes. “At present we have luxury homes available for purchase priced in excess of R5 million, while vacant plots which average at 1 000sqm in size are currently priced from approximately R650 000 up to R2 million – the latter being for well positioned plots right on the edge of the fresh water lake, which are hard to come by due to their preferred location.”
High demand for rental homes
Hammill says there is currently a strong demand for homes to rent in Richards Bay, particularly those under R6 000 per month. These properties are primarily located in the CBD and close to the university campus, making them ideal for buy-to-let investors for student accommodation. Two and three bedroom apartments can be rented from approximately R7 500 up to R9 000 per month, offering good value for money in appealing complexes. However, there is a shortage of such stock.
“In other areas such as Meerensee and Birdswood, the demand for rental stock is also strong, with rentals slightly higher, with two and three bedroom units, some with gardens and pools, commanding rates of R8 000 to R10 000 per month. When it comes to freestanding houses to rent, most areas are in demand as the availability of stock is minimal. When these are available, they start from about R8 500 a month for a basic three bedroom house, while in more upmarket suburbs some houses fetch up to R15 000 to R18 000 a month.” Pam Golding Properties currently has a fully furnished four bedroom, three bathroom home waterfront unit which includes a balcony on stilts in the water as well as a two bedroom flat, at a rental of R26 000 a month.
Says Hammill: “Those looking to rent homes in Richards Bay are across a broad cross-section of tenants, with some of our recently concluded rental transactions in the price range between R18 000 and R22 000 per month.”
Commenting on the area in general, he says there is talk of some form of waterfront development in regard to upgrading the beachfront and its facilities, which would make the area even more appealing for holidaymakers. “We’ve also heard that there will be some oil or gas grounds off the coast in the next few years, which would have the potential to provide a significant economic boost for the town,” he adds.