2016 will see a continued demand for property, particularly near the CBD nodes of Sandton, Rosebank, JHB central and the business districts in Midrand and Pretoria, says Charles Vining, Seeff’s managing director in Sandton.
“Urbanisation is intensifying and is demonstrated by the densification of areas like Sandton central and Rosebank, which the market is embracing. Sectional title property particularly sells extremely well, whether it is a development sale or a resale”.
Vining says that although the Sandton area offers property priced from R500 000 up to R50 million, the highest demand in 2016 will be experienced below R3.5 million, with most demand in the R800 000 to R2 million price bracket.
“In these price ranges, affordability is an important consideration for both buyers and sellers. Buyers should attempt to obtain some sort of bond pre-qualification or understanding of the purchase price they will qualify for to avoid being disappointed by the banks for looking at property priced beyond their means.
“Sellers also need to be aware of affordability issues, and work closely with their agents to understand whether finance on a particular offer is likely to be secured or not”.
Vining warns that while many investment buyers purchasing sectional title property between R1 million and R2 million in Sandton are cash buyers, these types of buyers need to be certain of the time frame in which their money will become available before a transaction.
“Properties in Sandton priced from around R5 million up to R9 million will also continue to have steady demand. Usually homes in this price range are either located in popular suburbs near to schools and main arterial routes or they are in security estates like Fourways Gardens and Dainfern.
“Cluster homes in suburbs like Houghton, Atholl and Bryanston are also to be found in this range. Buyers negotiate hard in this price range because they are looking to secure a good deal and are well aware of comparable sales in the area”.
Vining believes that luxury home buyers, looking at property priced at R20 million and above, will continue to exercise caution.
“Approximately 10 sales above R20 million were concluded in all of Sandton in the last 12 months, which confirms that there is indeed activity, but at a more restrained pace.”
Buyers with R20 million to spend will always weigh property investment against other investment options and will make careful decisions while referencing their existing investment portfolio.
While a significant amount of interest for lavish properties comes from buyers on the African continent, the majority of buyers in the upper end is predicted to come from successful South African businessmen and women.
Seeff Sandton concludes 25% of luxury home sales in Sandton, and currently has several homes priced above R60 million on the market. There has been interest in these properties, which reinforces the point that there is activity.
Vining predicts that on the whole, sale numbers will hold steady and there will be an increase in sales of between 7% and 10% year-on-year.
“The most important thing to bear in mind is that a well-priced home will sell quickly and that buyers are astute and will continue to do their homework,” he says.