In a rather surprise turn of events, the average selling prices of apartments at the V&A Waterfront Marina has hit new historic highs according to Lynn Pinn, Finella Botes and Ross Levin, Seeff’s area specialists.
Despite the slower sales volumes as a result of downward economic pressure, prices have continued to climb, reaching top rates per square metre not just at the Waterfront, but also at the Silo’s, Waterclub and in Clifton.
Seeff’s agents in these areas say that this performance once again demonstrates the inherent investment value and market strength when it comes to waterfront apartments.
“While many areas are recording stalling price growth, we continue seeing ever higher rates paid for apartments in key waterfront locations across the Atlantic Seaboard” says Levin.
The rate per square meter for Canal apartment reached an all-time high of R94,167/sqm (Kylemore) in the last year while the Front Yacht Basin (FYB) reached a record high of R132,336/sqm (Palgrave). The previous highs set in 2015 were R94,136/sqm (507 Kylemore) for the canals and R93,137/sqm (G01 Palgrave) for the FYB.
The total sales of 36 units for the 2016-year was only slightly lower than the preceding year’s 39 units despite the volatile economic and political conditions according to Pinn, Botes and Levin. They go on to point out that the value of sales continued trending upwards with sellers achieving much higher selling rates for their properties than ever before as demonstrated above.
Meanwhile, the entry level price for a two-bedroomed unit at the V&A Marina has now reached R11.75m.
The Silo’s too, has seen the highest level of resales with four units sold and reaching a record high price of R96,667-R99,929/sqm compared to the previous highest rate of R72,973/sqm in 2015. The entry level price for a two-bedroomed apartment here has now reached R9.995m.
“This performance just underpins the strength here. Notably, the bulk of the sales have been below the R20m price band with only two sales above this, similar to the 2015 year. Buyers still seemed to prefer canal-facing property, this being the most traded at the Waterfront Marina over the last year”.
The last quarter of 2016 saw the average selling prices at the Marina increase by a very notable 25% compared to the third quarter, says Levin. The sale of 302 Palgrave in the second quarter at R132,336/sqm is the highest average ever achieved in the estate.
“Another key trend was a drop in the number of days that it takes to sell a property here, down from 124 days in 2015 to just 45 days for 2016; properties effectively selling twice as fast”, says Pinn. “The average difference between the asking and selling prices meanwhile remained on par with 2015 at just 4.1% for the year, but with the fourth quarter dropping to as low as 2.8%”.
Foreign buying remains low. Of the R2.1bn in total sales at the Marina since 2011, only just over R485m, or just over 20% went to foreign investors, predominantly from the UK, Switzerland and Australia.
The neighbouring Waterclub estate in Granger Bay too has seen record highs with prices breaching the R100,000/sqm ceiling to reach new historic highs of R101,585/sqm and R119,728/sqm, having only reached rates of R68,702/sqm in 2015.
While Mouille Point reached R104,418/sqm (Amalfi) in 2015, it only recorded a high of R87 549/sqm in 2016 according to the agents.
Clifton apartments also raised the bar over the last year, reaching R146,465/sqm (Eventide) and R151,079/sqm (San Michele), up from a peak rate of R120,000/sqm (Heronwater) in 2015.
The overall selling price for sectional title property in Clifton also ranged at about R22m for the last year according to Lance Cohen, agent for the area, with almost all of the sales above R10m reaching R45m and R74m in Eventide. The comparative average rate for 2015 was R16.87m.
According to the international Knight Frank Prime Waterfront Index, waterfront property in the UK are worth about 70% more than their inland counterparts on average. Cohen says that this is echoed on the Atlantic Seaboard with Clifton prices around 70% higher than those of the City Bowl where sectional title prices still only reach around R40,000/sqm. The Waterfront Marina is only slightly below that at about 60% more expensive compared to City Bowl apartments.
“Going into 2017, we are likely to continue seeing pressure at the top end of the market across the Atlantic Seaboard as a whole, says Cohen. In the R20m-plus sector especially, the buying will be sporadic, but below that, we expect well-priced properties to continue attracting buyers”.
Pinn, Botes and Levin concur, saying that the Waterfront Marina and Silo-precinct is set for an exciting year. The new Silo’s are nearing completion as is the Zeitz Museum of Contemporary Art Africa along with a number of other developments around the Waterfront.