“Home buyers do not simply invest in a piece of land and the bricks and mortar on it. They also buy into the quality and ambience of the street address and surrounding neighbourhood,” says upper end homes marketer Ronald Ennik.
So much so, adds the principal of Christie’s International-affiliated Ennik Estates, that it has not been unusual in the past for Johannesburg buyers to reject a property out of hand while still on the street – even before they have viewed the home.
The reason, says Ennik, has been patently poor maintenance of the surrounding infrastructure. “That is why it is most encouraging for the residential property sector that the City of Johannesburg has handed an increased budget of R2,3 – billion to its Johannesburg Roads Agency (JRA) for 2015/16,” says Ennik.
“Provided it is fully utilised and wisely applied, the combination of an operating budget of R943-million, and a capital budget of R1,4-billion, will go a long way to restoring and uplifting suburban roads, bridges, pavements and storm water drains that have been crumbling in the past due to lack of maintenance.”
“It will also accelerate the tempo of new infrastructural development in residential areas,” adds Ennik.
“Astute buyers will subliminally devalue properties before they even get to look at them – let alone make an offer – when they discover they are located on roads blemished by potholes and crumbling surfaces, broken and blocked kerb inlets, and poorly constructed pavements”.
“While it is true that political cynics may well perceive a link between next year’s local government elections and the JRA’s increased budget, residential property owners should nevertheless be pleased by its value-adding implications,” says Ennik.
“Political nuances aside, this elevated level of service delivery bodes well for homeowner property values. Not only that, it provides an opportunity for the often much-maligned JRA – a well run, but seemingly constantly under-funded agency – to show its true capabilities,” he concludes.