A clear idea of how stock shortages are now making themselves felt in the Upper Constantia residential property market has been given by Gerald Romanovsky, the senior sales agent at the Rawson Property Group’s Constantia franchise (which is jointly owned by Eugene Pienaar and Nancy Todd).
In the first four months of 2013, said Pienaar, an average of 46 show houses opened their doors to the public every weekend. In the same period in 2014 the figure dropped to 24 and this year it has so far been running at 17.
“This,” said Romanovsky, “reflects a very significant fall of 63% – far higher than many people realize.”
Ironically, said Romanovsky, the current reluctance of Upper Constantia sellers to put their homes on the market has come about at a time when interest in this market has seldom been stronger.
“We at the Rawson Constantia have over 25 keen buyers waiting in the wings for the right opportunity to buy in Upper Constantia. A very high percentage of these now come from Gauteng, the main motivation being to move to an area with lower crime incidences, better municipal and provincial administration and good schools. However, we are also now seeing a marked, very welcome return of UK and European buyers, for whom, of course, the current exchange rates often make purchasing in Upper Constantia a relatively small and easy exercise.”
In the same 2013 to 2014 period, said Romanovsky, Upper Constantia prices have risen by 18%. In 2013 the average price of a home sold here was R7,1 million and today the figure stands at R8,4 million.
“Significant price rises in Upper Constantia were a long time coming,” said Romanovsky, “but it looks very much as if they are now here to stay – certainly for at least another year to 18 months.”
As always in market situations of this kind, said Romanovsky, the limited number of sellers can get unrealistic ideas of the value of their homes – but this, he said, ‘kills’ any real chance of achieving a sale.
“Today’s buyers,” he said, “are shrewd and market-savvy. They know to within a few thousand rand just what a home is worth. Overpricing in the hope of somehow finding a gullible buyer is a tactic that simply does not work, but no matter how many times we tell people this there will always be some who refuse to accept a realistic valuation.”
Asked if the ‘pricey’ image of Upper Constantia homes is perhaps a deterrent to certain buyers, Romanovsky said that it is still (just) possible in Upper Constantia to get a home at R5,5 million. At the same time, he said, Rawson Constantia and other agencies now tend to have several homes in the R25 million to R30 million bracket.