Although the Western Cape market is still enjoying a higher than average nominal price growth, recent reports show it has begun to stabilise. However, there are a few Cape Town suburbs like Pinelands which are still showing significant growth.
Lew Geffen Sotheby’s International Realty area specialist for Pinelands, Charlene MacPherson, says one of the suburb’s key drawcards is that erfs are generally substantial, making property here good value for money compared to the surrounding suburbs.
“Many homes also have dual living options which a lot of our clients want – either to accommodate family members or to rent out,” says MacPherson.
“The Pinelands market remains strong in spite of the prevailing economy and there seem to be more properties on the market at higher prices than two years ago. For instance, according to CMA the average house price in 2015 was R2.735 million and this has increased to R3.4m this year”.
“According to Propstats, the average house price for the period 2012 to 2013 was around R2.1m and homes spent around 16.5 days on the market before being sold. In 2017 the number of days homes are listed increased to around 27 days, mainly because there are fewer buyers around, but properties are still selling at higher prices, and show houses are well attended, with about 12 people on a show day.”
MacPherson says that although the Pinelands market is still active, sellers need to keep in mind the current economic conditions and tailor their price expectations accordingly.
“Some sellers have unrealistic sale price expectations and assume that the growth we have had over the last two years will be maintained, but realistically it has to begin slowing down. We now have some homes on the market at prices above those of Rondebosch and even Constantia, which will struggle to compete with the realistically priced properties.”
Stephen MacPherson of Lew Geffen Sotheby’s International Realty says most recent sellers are downsizing and retiring, and the majority of recent buyers have been in the 36 to 49 age group.
“Pinelands is a popular family area, and many of the current residents have lived here their entire lives. They understandably want to retire here, but the local retirement villages are full and waiting lists are closed, so they are obliged to stay put or look elsewhere,” he says.
“A lot of home owners are extending and renovating their properties as they realise that it would be difficult to find the same value and lifestyle elsewhere. At the same time, many buyers are looking for a ‘renovator’s dream’ as the older homes in Pinelands have huge potential depending on position and price”.
“Sellers should therefore not do more than repair the basics before they put their homes on the market as the next owners will want to add their personal touch.”
Lew Geffen, chairman of Lew Geffen Sotheby’s International Realty, says that Pinelands currently offers excellent returns in the short, medium and long-term.
“Investors who buy now are likely to realise a solid return within five to 10 years. There is also a strong demand for rental properties in Pinelands, with well-presented rental units offering good returns”.
Geffen adds: “Another reason for the steady demand for property in Pinelands is its central location; close to the Cape Town CBD and with easy access to the airport and the northern suburbs. This makes it an excellent choice for buy-to-let investors looking for profitable long-term investments,” concludes Geffen.