Record harvests and their positive effect on local businesses have led to an influx of house hunters in the Western Cape’s favorite fruit and wine producing valley.
The best crop harvests in six years – and the tremendous boost this has given the area’s agricultural businesses – has prompted young people to stream into the Breede River Valley in search of both employment and homes.
“In fact,” says Charles de Kock, owner of the Chas Everitt International franchises in Swellendam and Worcester, “they are currently snapping up just about every available piece of property along Route 62 from Tulbagh to Swellendam. Of the properties we’ve sold in the last year, two-thirds have been to young families permanently relocating to the area for work purposes.”
And the arrival of a slew of new residents has also caused property values to climb steadily, he says. “For example, in Swellendam and Barrydale, where a 100sqm three-bedroom home now costs around R1,4m, house prices have seen a healthy 10% increase since last year”.
“There has also been an enormous interest in commercial farms and the price of land has more than doubled in the past two years: from around R30 000/ha to an average of R70 000/ha.”
De Kock says that Worcester, the biggest town in the Breede River Valley, currently presents potentially lucrative – and still largely untapped – property investment prospects. “There has been considerable industrial development in and around the town, and a number of residential estates are also being built. We are currently selling properties in La Chardon, a secure development located on the outskirts of the town that will eventually comprise 200 homes. Priced from R849 000 for a two- bedroom house, these properties offer a great investment opportunity when you consider that the rental return in Worcester is around 8%.”
Meanwhile Robertson, located in the heart of an officially recognized Wine of Origin region (and the Cape’s largest irrigated wine-producing region), has seen house-price growth of nearly 7% this year, according to Mardi Botha, the resident Chas Everitt International property consultant.
“We’re selling an average of six houses a month to both young professionals who are starting local businesses and older people from Cape Town and Johannesburg wanting a taste of country life. Small ‘lifestyle’ farms are very popular as either weekend retreats or to set up as guesthouses and they sell for between R3m and R5m”.
“Properties in the new Silwerstrand Golf Estate on the outskirts of town are also selling like hotcakes. We have some 50 properties available there at prices from R1,8m to R3m,” she says.
About 20km to the south, in the foothills of the Riviersonderend Mountains, McGregor is attracting equal attention. “When I arrived here seven years ago a small two-bedroom cottage would have sold for around R700 000. Today, these properties are going for R1,3m to R1,4m,” says Shaun King, who heads up the Chas Everitt International franchise in the village.
There has also been a distinct change in buyer profile, he notes. “Two years ago half our buyers were Capetonian retirees and the other half were foreigners. Now, they’re all South Africans and mostly professionals who live here permanently and who either work remotely or own guesthouses where they get up to R1500 per person for a night’s stay.”
According to King, a serious shortage of stock is pushing prices up even further. “The village is bordered by a nature reserve so cannot expand at all, which, of course, escalates prices. Right now it’s definitely a seller’s market and buyers are prepared to overpay. Anything under R2m in a good part of town will sell within a week.”
Demand similarly exceeds supply in Montagu, which, like McGregor, falls within the Langeberg Municipality. “Our stock has been significantly depleted in the last 24 months due to the town’s popularity. Property values have increased as much as 30%, with the average house now selling for R1,45m,” says Nelda Wiese, who operates the Chas Everitt International franchise in Montagu, which also serves the neighbouring towns of Ashton and Bonnievale.
“While we do have a small percentage of ‘swallows’, Montagu is increasingly attracting young families and our buyers include entrepreneurs and those in the hospitality industry who are taking advantage of the upsurge in tourism that the town has experienced in the past few years,” she says, noting that this appeal will only intensify when the major improvements that are currently being made to the pass through Cogmans Kloof – Montagu’s access road through the Langeberg – are completed in four years’ time.
At R950 000, the average house price is substantially lower in nearby Bonnievale, but that is destined to change, predicts Wiese. “The construction of an academic technical entrepreneur school is about to kick off in the village and it is scheduled to open in 2018. This multi million-rand Department of Education project is being built on land donated by Philip Jonker of Weltevrede Wine Estate and will cater to 600 learners. In light of South Africa’s technical-skills shortage, it will be a massive boost for the area – and indeed, for the country as a whole.”