According to Knight Frank’s 2018 Wealth Report, there was a staggering 56% increase in property investment in 2017.
The report highlights that in spite of stock markets reaching record highs in 2017, there is an uncertainty around tax reform and politics. As a result, an increasingly professional pool of private capital is considering property as a safer investment option.
The survey revealed that an increase in risk taking to yield higher returns was driving the property boom and it predicts that the appetite for real estate would continue to increase as investors grapple with a low-return equity environment. 38% of the UHNWI’s also indicated that their portfolio already includes overseas properties, the balance in their own country.
According to the Wealth Report’s Prime International Residential Index (PIRI 100), a luxury residential market performance by global rank and geography, Cape Town grew by 19.9% between 2016-2017. This puts Cape Town in the number two position globally, after Guangzhou in China, which grew by 27% during that period.
And this trend looks set to continue, according to Richard Hardie, Knight Frank Atlantic Seaboard, City Bowl & Hout Bay Manager:
“A world-renowned business address, Cape Town CBD is now emerging as a sought-after residential postal code too. The city’s central core extends from the Harbour, with Stand Street and the Railway Station at its core. Once dominated by high-rise office blocks, an injection of new capital and innovative ideas is changing the city’s skyline.”v
Download the report here.