A front view of the stunning and luxurious Mount Pleasant Manor located in Newlands.
Rawson Property Group agents in Cape Town’s Southern Suburbs have been reporting increasing interest in the area’s luxury market, with sales continuing to heat up in spite of the ongoing economic pressure being experienced in South Africa.
“The luxury market is generally less affected by the economy than other market segments,” says Elia Theocharis, a sales agent with the Rawson Property Group’s Constantia franchise. “The rand may be struggling right now, but there is still a lot of money in South Africa, and we’re seeing plenty of expats investing their dollars and pounds in property here as well.”
With Southern Suburbs property typically outpacing the current interest rate when it comes to growth per annum, Theocharis is not surprised that the upper tiers of the market are still thriving. “Cape Town is winning international awards as the place to visit, and these visitors are falling in love with our city,” he says. “South Africans from upcountry are also moving down, and the demand for luxury property, city-wide, is extremely high. Add to that the asset growth, convenience, lifestyle, and great schools in the Southern Suburbs, and it’s only logical that our luxury areas are popular with affluent buyers.”
Gareth Edwards, a sales agent with the Rawson Property Group’s Kirstenbosch franchise confirms Theocharis’s observations: “We’re definitely seeing positive movement in luxury property, with more and more listings appearing in the R10 million plus category in Newlands and Rondebosch,” he says. “Homes that were not deemed luxury in the past are also now falling into that category as prices climb, and we are likely to see the luxury market extending into previously less prestigious areas as demand exceeds supply.”
While larger, iconic properties like Mount Pleasant Manor in Newlands (currently on sale for R14.75 million), are attracting considerable attention from both local and international buyers, Edwards has also noticed an increase in demand for luxury properties on more compact grounds in Newlands and Rondebosch. “We do have some spatial limitations because of Table Mountain,” he explains, “which restricts the number of new homes that can be built in suburbs like Newlands, but the popularity of smaller grounds isn’t just because of a lack of undeveloped land. It’s also got to do with ease of maintenance, and a desire for a more compact and secure lifestyle.”
Theocharis notes similar trends arising in Upper Claremont, as evidenced by the increase in luxury developments taking place. “Developers are capitalising on the demand for secure living that is being driven largely by upcountry buyers,” he reveals, “and we’re seeing more and more top end estates like The Struben and Eton Square going up.”
According to Theocharis, this increase in luxury development is a good indication that the current positive growth in top end Southern Suburbs property will continue. “If the market isn’t ready, developers stand to make catastrophic losses on new estates,” he explains, “which is why they take holding costs and future growth very seriously when conducting feasibility studies. They’ll only start construction if they are confident their investment will achieve good returns, so if there are cranes in your area, you can usually expect good growth in the near future.”
While this bodes well for existing owners of Southern Suburbs properties, those hoping to get a foot on the luxury ladder for the first time are advised to act soon or risk being priced out of the market.“It is getting more difficult to enter the luxury market,” says Edwards, “but buyers in the Southern Suburbs can be confident that demand will continue and their asset’s value will, inevitably, increase. That’s not something to be taken lightly in today’s day and age.”