Port Elizabeth and East London continue to attract younger buyers, with the majority of new homeowners either 36 to 49 years old, or young adults below 35 years of age. This is according to Pam Golding Properties’ senior research analyst, Sandra Gordon, who said the “relative affordability of homes in these metros, combined with the coastal lifestyle offering, may well explain the appeal of these housing markets for young families and first-time buyers”.
“In 2017, while median prices for freehold properties in East London marginally exceeded prices in Port Elizabeth, activity in Port Elizabeth’s larger housing market has recovered more quickly in the wake of the 2008 recession,” said Gordon. “Port Elizabeth has also experienced a near-doubling in vacant plot sales during the past five years, suggesting continued growth in the local housing market in the years ahead. Development around Coega remains a positive factor impacting the demand for homes to buy and rent, while the Beijing Automotive Group Co. from China recently made an R11bn investment in a vehicle manufacturing plant in Port Elizabeth, which is expected to become operational this year (2018).”
A further fillip for the Eastern Cape is the recent announcement that Mercedes-Benz is investing some R10bn in expanding its East London plant for production of the next generation of the C-Class.
PGP area principal, Ian Olivier, said there was buyer demand in Walmer, Lorraine, Mill Park and Summerstrand, and that land was becoming scarcer.
“We are seeing developments being launched in areas such as in and around Baywest, Lorraine and Sherwood,” he said. “Lorraine is always sought after for its good value for money, as is Richmond Hill which is upgrading and vibey as well as close to the central hub and transport routes. Here you can acquire a nice home for less than R1m, although for the first time we are seeing asking prices of up to R1,5m.”
In East London, the residential market is further supported by industry staff, such as those working for Daimler Chrysler which employs staff from Germany on a contract basis, taking up a fair amount of rental properties.
“Homes within secure estates remain sought after and in short supply,” said Sean Coetzee, Pam Golding Properties area principal in East London. “The recent launch of sectional title apartments and simplexes and full-title vacant stands in Olivewood Private Estate & Golf Club has aroused considerable interest in the marketplace, with 30 erven sold in phase one, priced from R500,000.”
St Francis Bay
In St Francis Bay, Pam Golding Properties area principal, Richard Arderne is equally upbeat, saying some 22% of sellers are locals who are not leaving town, but trading up or down, or just relocating. “Many of these are buying additional properties to develop or for speculation. We attract approximately a third of buyers from Gauteng, with a mix from other provinces and a few from overseas. About 17% of buyers have moved here permanently, with a similar percentage planning to move here within the next few years. The balance comprises holidaymakers and Port Elizabeth ‘weekenders’.
“From an investment perspective, property in St Francis Bay is performing exceptionally well, with the average price of homes on the canals having doubled from 2012 to 2017. At present the builders are busy, with 19 houses being constructed (or undergoing major refurbishments) on the canals and almost as many being built on The Links – where sales of homes and plots are buoyant.”
In nearby Port Alfred, Pam Golding Properties area principal Isobel Meyer notes an increase in buyers looking to relocate from inland and upcountry to the coast, motivated by the lifestyle, lower cost of living and retirement. “The upgrade of the R72 through Port Alfred to East London has prompted an influx in demand for rental properties being leased to contracting companies in and around Port Alfred to house staff and their families.
“The market to buy is buoyant in the lower price bracket up to R1,5m, particularly freehold properties on Port Alfred’s West Bank, sought after by middle income earning families and retirees. We are also seeing an increase in unit sales from R2,5m, with the Royal Alfred Marina generating the most interest at the top end of the market.”
The market between R900,000 and R1,3m in Jeffrey’s Bay is very active with a shortage of stock, reports Jaco Bothma, Pam Golding Properties area principal. “Developers and speculators are back in the market, especially in Fountains Estate, while upper Wavecrest has come into its own.
“Fountains Estate offers good value for money, making it popular among first-time home buyers who can acquire a brand-new, three-bedroom home with single garage for just over R1m.
Bothma said beachfront property is sought after with very little stock available. “Currently the lowest priced beachfront property is R8,9m for a straightforward three-bedroom, facebrick house with double garage. Only about four years ago such properties were going for between R3,5m and R4m. Frontline homes currently on the market include a spacious five-bedroom home with direct beach access, priced at R11,995m.”