An aerial photograph of Chapman’s Bay Estate in Noordhoek, Cape Town.
The lifestyle attractions as well as growing concerns about security and municipal service levels nationally are driving the success of secure estates countrywide.
The Cape is no exception and the Southern Suburbs and South Peninsula areas are also feeling this effect markedly with both local and upcountry enquiries at high levels. However, scarcity of well located land available for development is proving to be a major factor pushing up sales prices.
Secure estates are selling out fast and attracting buyers willing to pay a premium because the stock trickling onto the market in the most sought after parts of the Cape does not appear to be meeting the demand.
Magnus McDowall of Flagstone Property Developments, a substantial investor in the development stock of Chapman’s Bay Estate in Noordhoek, said the supply pipeline is being choked by a scarcity of suitable land together with the complex and onerous legislative environment and consequently delays associated with obtaining all the necessary development approvals.
Prospective developers of secure estates also have to consider the operational costs, passed on in the form of levies. In the context of the Western Cape, particularly in the Southern Suburbs and the South Peninsula, there is a shortage of land parcels big enough to meet the need for enough units to keep these levies at a manageable level.
“This is compounded by the reality of a legislative environment where town planning and environmental requirements can take many years to pass through the system. For example Chapman’s Bay Estate has taken 14 years to get to this stage of development,” said Mark Tame of Percipient Property Solutions, the Joint Development Managers.
The high level of demand coupled with a limited supply has meant that the majority of well executed secure estates in Cape Town have shown meaningful capital growth, particularly for buyers who have shown confidence at an early stage. “This is frequently the case and research indicates that properties in nearby estate Lake Michelle in Noordhoek, Stonehurst and Silvertree Estates in Westlake benefited from a material escalation in prices as the number of available plots diminished,” said McDowall. “In fact we have already seen the same pattern emerge at Chapmans Bay Estate where the Town houses values have escalated very significantly from launch as we approach complete sell out”.
The rate of demand at the 47.5 hectare Chapman’s Bay Estate, which will feature 144 contemporary homes, has had a further beneficial impact on purchasers as the civil engineering phases have been accelerated to such an extent that infrastructure on the entire estate is expected to be completed by mid 2016 and building activities will therefore be completed sooner. Chapman’s Bay Estate has sold over 70% of available properties in the first five phases, with up-country South Africans, attracted by a combination of security, a well-managed Metro and the lifestyle that Noordhoek offers, making up a significant portion of buyers.
“In excess of 25% of Chapman’s Bay Estate buyers are from outside the Western Cape, split about 60% from Gauteng and 40% from KwaZulu-Natal. Many are business people choosing to live with their families in the Cape and to commute to their places of work up country,” said Tame.
“Secure estate living, with an estate manager taking onboard the responsibility for the environment, roads and other infrastructure, is increasingly attractive for buyers wanting to live in an environment that is well maintained, clean and above all safe.”