With the renewed popularity of heritage suburbs close to city centres now well-established, the existing owners of large properties in those areas are finding great benefit in sub-dividing and selling off parts of their acreage to new residents and spec builders.
“The costs of securing and maintaining a home with a big garden are increasing all the time,” says David Jacobs, the Rawson Property Group’s Regional Manager for their Northern Region and KZN. “Property rates and municipal charges have also increased substantially in recent years and we have seen how this has prompted many owners in Johannesburg suburbs such as Bryanston, Houghton, Linden, Melrose, Parktown and Saxonwold and Pretoria suburbs such as Brooklyn, Lynnwood and Waterkloof to sell their homes and downscale to smaller properties or retirement villages”.
“In some cases their homes are being bought by younger families happy to have the extra space, and in others by developers eager to supply the rising demand among young professionals – and empty nesters – for upscale modern apartments, townhouses and cluster homes in these older suburbs, where everything from schools, shops and restaurants to health clubs, sports venues and medical facilities are easily and quickly accessible.”
This trend is evident, he says, from the mix of homes now available in heritage suburbs, where there used to only be large houses set in large gardens. “For example, we currently have several very large homes currently for sale including a five-bedroom, three-bathroom home with a separate two-bedroom cottage on a stand of more than 2000sqm in Linden that is priced at R3,5 million, and a three-bedroom, three bathroom home with a home office on a stand of more than 3200sqm in Bryanston that is priced at R3,4 million”.
“Then in Pretoria, we are currently marketing a five-bedroom, four-bathroom home on a stand of more than 2700sqm in Waterkloof for R5,3 million, and a six-bedroom, four-bathroom home on a stand of more than 2200sqm in Lynnwood for R4,7 million”.
“But we also have several smaller, more modern executive homes currently available in the same sought-after areas, including a stylish three-bedroom, two bathroom apartment in Bryanston that is priced at R2,139 million, and a spacious three-bedroom, two-bathroom duplex townhouse in Lynnwood that is priced at R2,95 million”.
“And for younger buyers there are now also many new and ultra-modern apartment and cluster home developments to choose from in Bryanston, with unit prices starting at around R900 000. We are also currently marketing brand-new, three-bedroom apartments and clusters in Lynnwood, for example, at prices from around R2,3 million.”
Meanwhile, Jacobs says, a second group of existing owners is emerging in the central suburbs. “These are those who have decided that they would prefer not to relocate but to stay on in the homes they love, and continue to enjoy all the advantages of the area where they have lived for years and know all their neighbours. And in order to achieve this, they are seeking to reduce the costs of running their existing homes by subdividing their large stands and selling off the sections they don’t need to a new generation of residents”.
“In this way, they are able to unlock much of the value growth that has occurred since they bought their properties – which is often very substantial in heritage suburbs – without actually having to move. They can then use the proceeds of the stand sales to pay off their own bond or add to their retirement funds, while also achieving significant savings in terms of their monthly security, maintenance and operating costs”.
“The other advantage of this rising trend, is that it creates opportunities for younger buyers and not just developers to gain access to freehold stands in areas where these have been extremely scarce for many years, and build their own ‘forever’ homes. It is now possible, for example, to acquire stands of between 750sqm and about 1000sqm in the most popular central suburbs at prices from around R980 000 – although they do range all the way up to about R3,5 million.”
However, he says, although the local authorities are generally in favour of sub-division and the densification of older suburbs in order to accommodate rapidly increasing urbanisation, the actual sub-division process remains complicated, costly and lengthy. “And this is prompting on the stay-on property owners to look at alternatives, including the relatively simple conversion of their properties to private sectional title complexes, with several new homes, as well as their existing home all on one stand.
“Sometimes called duets, the new homes can be sold in the same way as any other sectional title units, and in fact we currently have quite a few for sale, including a high-security three-bedroom home with a double garage in Brooklyn that is priced at R3,6 million. But increasingly, we actually see homeowners creating these complexes in conjunction with their adult children or other family members as ‘family estates’ where everyone has their own home and privacy, but shares the costs and responsibilities for property maintenance, security, insurance and any communal facilities”.
“This course of action has many advantages for everyone involved – including no land costs for the adult children who would like to raise their own families in an upmarket area close to the best schools, and much lower monthly costs and added security for the parents. Consequently, we expect it to become an even more popular option over the next few years among those who have retained their large properties.”