“The Atlantic Seaboard property market ended the 2016 year with a surprise uptick in overall activity compared to the preceding year”, says Ms Billy Rautenbach, Sales Director for Seeff’s operations across the area.
She says that a number of key indicators performed notably better compared to 2015. This includes an increase in the overall number of units sold and a quickening in the overall pace of selling with the number of days on the market practically halving from 2015.
According to the latest Propstats data, the Atlantic Seaboard market ended the year with overall activity up by 6% in unit terms with 709 units sold compared to 669 in 2015 and 10% in value terms with 2016 sales of just over R5,5bn compared to R5bn in 2015.
“The overall average selling price increased by 4% from just over R7,4m in 2015 to over R7,7m while the average difference between the asking and selling priced remained static at 7.6%. The average time on the market though almost halved from 98 days in 2015 to just 51 for 2016”, says Ms Rautenbach.
“In the lower price bands, the picture is even better”, she says, adding that the days on the market dropped to just 30 days for properties below R5m and 37 days below R10m.
“If we segment the market further, we note that full title property performed well in price growth terms, despite the overall units sold dropping from 198 in 2015 to 172 in 2016. The total value of sales increased from just over R2.5bn in 2015 to over R2.521bn in 2016”.
The biggest movement in the full title sector was the average sales price that increased by 16% from just over R12.6m in 2015 to R14.6m, thus a significant R2m more per unit sold for the market as a whole.
The average difference between the asking and selling price of full title property increased marginally from 10% in 2015 to 10.3%, but the average time on the market practically halved from 176 days to just 86 days, or around 12.2 weeks.
“About half of all full title sales were below the R10m price mark, selling at an average of R7.224m per unit and at a much faster pace of just 47 days on average and at a difference of only 6.8% between the asking and selling prices. The price sector to about R20m, is also where we expect the bulk of the demand this year”, she adds.
At the top R20m-plus sector of the market, about 24 sales were concluded at an average price of just under R32m and with five properties sold above the R40m price mark. This sector is likely to remain very discerning throughout the year.
Only three tracts of vacant land sold during 2016, being 389sqm (for two adjacent plots) in Sea Point that sold at R7m, 206sqm in Green Point that sold at R5.1m and 601sqm in Camps Bay that sold for R5.93m. Land is in short supply as reflected by the low sales volume and excellent prices paid in Sea Point and Green Point in particular.
The sectional title sector continued to grow in line with the uptick in the demand for compact living and of course, this sector tends to offer a more affordable option for buyers. It accounted for 76% of all units sold across the whole area, increasing in volume terms by 14% from 471 sales in 2015 to 537 last year. The rand value increased by a very notable 19% from just over R2.5bn to almost R3bn, thus generating a significant R500m more value for the market last year. The average selling price though increased by only 5% from R5.3m to R5.5m, although she says that was still good in the wider economic sense.
“A remarkable almost 60% of all sectional title sales were above R3m, sixty six (66) of which were above the R10m price mark, mostly at the V&A Waterfront Marina (18 sales) followed by Camps Bay (13 sales), Clifton (9 sales), Bantry Bay and Mouille Point (8 sales each), Sea Point (7 sales), and Fresnaye and Green Point with one sale each”.
Overall, Sea Point tops the sectional title ladder with 226 sales followed by Green Point with 95 sales and Mouille Point with 53 sales. The Waterfront clocked up 40 sales in all at an average sales price of R11.327m, reaching record highs paid per square metre of R94,167/sqm on the Canals and R125,122/sqm on the Front Yacht Basin according to Lynn Pinn, Finella Botes and Ross Levin, agents for the area.
Although 2017 is likely to be challenging, Ms Rautenbach says that the more positive outlook with leading economists expecting a mild improvement in the economy is encouraging. That said, she adds: “We are still in uncertain times and with the ANC’s elective conference set for the end of this year, it is likely to be an interesting year”.
Nonetheless, the Atlantic Seaboard remains one of the most resilient markets and there are still plenty of good opportunities to be had for buyers, sellers and investors.