The vibrant suburb of De Waterkant has undergone a massive transformation in recent years as ongoing development and upgrades have endeavored to keep pace with demand for commercial and residential property in this eclectic enclave on the cusp of the CBD and Atlantic Seaboard.
Although this triggered a significant surge in market strength and activity, De Waterkant hasn’t been completely impervious to the current economic woes with fewer sales recorded between January and June 2016 than for the same period last year as well as subdued interest in properties at the upper end of the market.
However, whilst sales volumes may have dropped, property values and achieved sale prices have continued on an upward trajectory, especially in the sectional title middle market.
This is according to Michael Meade, Area Specialist for Lew Geffen Sotheby’s International Realty, who says: “Propstats records show that during the first six months of 2015 apartments realized an average sale price of R2.57m at 5.6% less than asking price after an average of 57 days on the market”.
“Between January and June this year, the average listing time was just 10 days with an average sale price of R2.95m and the difference between realized and marketed price had reduced to 4.9%.”
According to Meade, the majority of all recent sectional title sales are units in the new developments, with Harbour Edge achieving the most sales as well as the highest price in 2015 (R6.8m) while Soho on Strand is the current leader this year with a sale of R5.35m – at full asking price.
He adds that although freehold homes make up 25.81% of the property landscape in De Waterkant, they seldom come onto the market as owners tend to hang onto these gems and usually live in their properties rather than rent them out.
“And, as they are situated above Somerset Road where there is no space for further development this has resulted in a critical stock shortage”.
“Owners are aware that these scarce and highly sought-after properties are excellent long-term investments, with the current record median price of R5.35m very unlikely to drop in the near future as demand for property in and around the CBD continues to rise steeply.”
According to Lightstone data, 34% of home owners in De Waterkant have owned their properties for 11 years or longer with 40% of stable owners being in the 50 to 64 age group.
However, as a result of the ongoing development below Somerset Road, investors who bought less than five years ago now account for 36% of the investor market and 56% of recent buyers aged between 36 and 49.
Lew Geffen, Chairman of Lew Geffen Sotheby’s International Realty, says that surge in recent buyer numbers and their demographic reflects the market sentiment that the new developments are regarded as attractive investment opportunities which will yield solid returns in the short and long- term.
“De Waterkant has a very active and lucrative year-round short term rental market due to its central location which offers easy access to the CBD, the convention centre and the V&A Waterfront as well as world-class beaches and Cape Town’s other major centres via the N1 and N2″.
“Most popular with tourists and corporate visitors are the newer developments like The Rockwell, The Mirage, Harbour Edge, Harbour Terraces and The Hudson which offer 24-hour security, secure parking and a cosmopolitan ‘live, work, play’ lifestyle.”
Geffen adds that another major drawcard is that, despite being adjacent to the CBD, De Waterkant has retained its quaint village atmosphere with its European sidewalk café culture, quirky shops and original cobbled streets.
This can largely be attributed to the fact that the suburb has a rich history that dates back to the 1700s, with most of the original houses still intact and under the strict stipulations of the Heritage Council.
De Waterkant has also always been very popular with Cape Town’s gay community who, along with a growing number of young professionals, make up the majority of the suburb’s permanent residents.
Aside from its convenient location, residents love the fact that De Waterkant is a self-sustaining suburb with a choice of excellent restaurants, diverse stores, a lifestyle shopping centre and vibrant nightlife which means that everything they need is no further than a stroll away.