First-time homebuyers are targeting Cape Flats suburbs because of their position close to the CBD and good public transport. This home in Gleemoor was recently sold by RealNet for R980 000, which is comfortably within the most popular price range.
Homes sales in Cape Flats suburbs such as Athlone, Kewtown and Hanover Park are currently surging as the area enjoys the knock-on effect of strong demand and price inflation right across Cape Town.
That’s the word from Narriman Mohammad, owner of the RealNet Athlone franchise, who notes: “Prices in the Cape Town metro as a whole have risen by 14,9% in the past year, according to the latest Western Cape House Price Index compiled by FNB, and this is good news for property owners in Athlone and the surrounding suburbs, as the increase in values means that many can now sell at a profit and upgrade to bigger or more expensive properties”.
“Some older owners are also now finding this an opportune time to sell and move to a secure complex or retirement village, which is in turn releasing stock into the market and opening the way for younger buyers to get on to the property ladder in the more affordable areas.”
And there is certainly no shortage of demand, she says, thanks mostly to the fact that these areas are so close to the Cape Town CBD and well-served by public transport. “Current sales are robust, with demand also being driven by the fact that Athlone itself is a business hub and attracting people who want to live close to their workplaces.”
Buyers who are upgrading, Mohammad says, are moving to homes in areas such as Rondebosch East, Crawford, Gatesville, Rylands, Plumstead and Lansdowne, where prices range from about R600 000 for a two-bedroom apartment all the way up to around R2,8m for a large four-bedroom family home. However, the majority of sales being handled by her franchise are to people targeting homes in the R250 000 to R1,5m range.
“Currently, 75% of all bonds being granted are to first-time homebuyers aged 30 to 35 and from a diverse mix of cultural backgrounds. Their preference is for low maintenance, lock-up-and go homes with high security features, and their needs include proximity to schools, churches, shopping malls and places of employment.”
“They generally don’t have large deposits, and are often working on a tight budget that is very sensitive to interest rate or fuel price increases, food price inflation, the availability of public transport and, if they are running a local business, to load shedding.”
“Consequently, we are always very careful to leave them enough room to manoeuvre when we calculate their ability to pay their bond instalments in addition to other monthly payments, and to take a conservative approach when advising them how much they can realistically afford to pay for their new home.”
In this regard, she notes, the increase in the transfer duty threshold to R750 000 this year has further boosted demand in her area – and not because it enables buyers on a restricted budget to buy more expensive homes, but because it reduces the amount of cash they need to have on hand in order to complete the transfer process.