Arthur takes a look at why Cape Town’s property market is thriving…
With its rich history, stunning viewpoints, pristine beaches and amazing wildlife, it is no wonder that Cape Town is South Africa’s most iconic city. It boasts an array of world-renowned restaurants and has a buzzing cultural and design scene on offer. Not to mention that some of the country’s best safari reserves and most prestigious wine growing regions are just a couple hours drive from the city. It’s not surprising that more and more foreign buyers are looking to snap up hot property in South Africa’s legislative capital.
Despite a tough year (economically speaking) for the country, Cape Town’s property market has remained resilient. Dr Andrew Golding, Chief Executive of the Pam Golding Property (PGP) attributes this to the “continued vibrancy of the country’s major metro areas coupled with an ever-growing preference for property as an asset class at a time of extreme financial market volatility”.
Property prices in the Atlantic Seaboard area of Cape Town have increased more than twofold since 2012, and there doesn’t seem to be any indication of a slowdown in the eastern or southern suburbs, City Bowl or the Southern Peninsula, which are all continuing to outpace average house price growth across the cape. In recent years, the commuter regions of Bloubergstran, Milnerton and Melkbosstrand have also become increasingly attractive. Cape Town’s tourist boom, and the introduction of AirBnb have also been indicated as major factors for increasing property prices in recent years.
Private Property says that before 2008 the majority of foreign buyers were from the UK or northern Europe. Now Cape Town has a much wider appeal with buyers coming from over 30 different countries.
Considering the stunning views on offer in many of Cape’s more up-market properties, foreign buyers still consider Cape Town to be relatively affordable – especially in comparison with more traditional areas to invest in luxury property, such as the Caribbean. But the increasing demand from foreign buyers, migration trends within South Africa itself, and the geographical limits of the city (due to the limits imposed by the mountains and coastline) mean that the housing stock is decreasing.It is no wonder that the majority of homes that come onto the market are selling at asking price value within 1 – 4 weeks of coming onto the market.