Home owners holding on to property for longer

Home owners holding on to property for longer

A recent property survey has indicated that home owners in Gauteng and the Western Cape are holding on to their assets for longer, hoping to realise higher prices in the residential market.

Property giant, Lightstone’s Andrew Watt says home owners in these provinces have waited roughly six years before disposing of their property, but this waiting period seems to have increased to eight years, with the exception of KwaZulu-Natal. What has also emerged is a spike in house prices in the Eastern Cape over the past few months, but Watt says it is too early to speculate on the reason for this.

Watt says house price inflation remains relatively muted although it is still positive with the affordable market remaining the pick of the value segments. Recent statistics gauging property price growth over the mid to long term, have shown the top performing luxury suburbs were, not surprisingly, in the Western Cape.

The top performer in this sector was La Pastorale suburb in Stellenbosch, followed by Zwavelpoort and Westcliff in Gauteng. Other top Western Cape performers included Kalk Bay, Mostertsdrift, Sunset Beach, Scarborough and Murdock Valley. This luxury sector includes residential properties from R1.5m and more.

In the high value band, meaning houses ranging from between R750 000 to the R1.5m mark, the picture is remarkably different and features suburbs from the Western and Northern Cape, Limpopo, Mpumalanga, the Free State and KwaZulu-Natal.

A presentation at a Rode 2011 conference in Johannesburg showed that the top performing Eastern Cape suburbs over the past 15 years were found mostly in Nelson Mandela Bay, followed by Kouga, Buffalo City and Baviaans. The equivalent in the Western Cape was the city of Cape Town, George, Swellendam, Oudtshoorn, the Breede River Winelands, Witzenberg and the Cederberg.

What also emerged during the Lighthouse presentation was that over 80% of foreign owned properties in South Africa were valued under R3m which indicates that ownership is not limited only to the very top end of the market which accounts for roughly 5% of foreign ownership. As far as ownership in the provinces is concerned, the Western Cape historically and currently leads the pack, followed by Gauteng, KwaZulu-Natal and the Eastern Cape with the other provinces trailing behind. The province that has least piqued the interest of foreign ownership is the Northern Cape with its harsh climate.

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Denny Crane

Denny Crane
It's not me ... yet. Denny Crane from the TV series Boston Legal. Click on picture if you're not sure who he is!