One of the many vineyard views available at Constantia.
There is now, says Gerald Romanovsky, senior residential estate agent at the Rawson Property Group’s Constantia franchise, clear evidence that the upswing in upper bracket residential property on which the Rawson Property Group Chairman, Bill Rawson, commented earlier this year, is particularly evident in Constantia.
Quoting Lightstone and Propstats’ data, Romanovsky said that in the Upper Constantia precinct over the last 18 months, nine “decidedly upmarket properties” have been sold at an average price of R18 million. Nowhere is this upswing more evident, he said, than in the Constantia precinct known as the Hohenhort or Ambassadorial belt. In the first six months of this year, three properties were sold at an average price of R14,5 million and the average sales price achieved in the same period last year was very nearly half the figure achieved for this area. What is more, said Romanovsky, it seems clear to him that the upward trend is continuing.
Romanovsky said that there are also clear indications that big price sales are about to take place in the near future. He is currently negotiating a R40 million deal and it is believed that another estate agency is about to sell a property off Southern Cross Drive for R50 million.
The upswing in sales, added Romanovsky, has been accompanied by some significant trend changes. Previously the fastest appreciating properties were always in Constantia’s well-known and decidedly upmarket security estates which have often been able to charge premium prices. This year, however, he said, the trend is not nearly so marked: many of the top prices achieved have been for independent freestanding homes which are sited on their own plots.
“This”, he said, “was a change that at the start of this year I predicted would take place and it is now clear that I was right.”
Asked to what he attributes the upturn, Romanovsky said that despite regular press coverage on the crime rate in Constantia, the truth is that excellent neighbourhood watches coupled with thorough monitoring by CCTV and other methods have made Constantia one of the most secure precincts in Cape Town.
This fact, he said, as well as the close proximity to good schools, shopping centres and sports clubs, has drawn in the younger set, the majority of today’s buyers being in the 36 to 50 year old age group – and a high percentage of them are from Gauteng. However, the majority of sellers tends to be in the 50 to 70 year old age group.
The young buyers, added Romanovsky, are aware that by international standards Constantia property is still exceptionally low priced and several have commented to him that they anticipate 10% plus appreciation in the value of their properties over the next few years. This, he said, would not be an unrealistic expectation as the recent ABSA survey has shown that since 1996, property price increases throughout South Africa have averaged 11,6% per annum.
Romanovsky commented, too, that certain Constantia properties on the market have had to be priced below what they should be achieving and the reason for this, he said, is that they have not been as well maintained as they could have been.
“Buyers,” he said, “will always discount their bids on properties which they perceive as being in need of renovation, even though this may be of a fairly minor sort. The old truth remains completely apposite: land in high priced areas like Constantia will always appreciate steadily but a home on which there has minimal upgrading year-by-year will not command the price it should. Any expenditure on maintenance and upgrading is, therefore, in almost every case more than adequately recompensed by the value it adds to the property.”