Property developers will have to increasingly cater and make provision for affordable housing in their development plans or be faced with political pressure which will see government force their hand.
This is according to Western Cape Property Development Forum chairperson Deon van Zyl, who spoke at the Central City Improvement District’s (CCID) business breakfast.
“Our reading of the political environment at the moment, the social and politically environment says: housing is no longer a nice-to-have discussion, it is real.
“People are being discriminated against by not being able to access opportunity. That is the social and economic reality, we as the property development sector can turn our backs on that discussion or we can say there is an opportunity,” said Van Zyl.
He said providing affordable housing in the Cape Town city centre was not charity, and there was a business case to be made or await government pressure.
“We have a window of opportunity to choose... I’m asking people to go and understand the business opportunity,” said Van Zyl. He said South Africa’s banks would also have to get on board, and think about how they could finance affordable housing close to where people worked.
“A couple of years ago the banks wouldn’t touch student accommodation. Five, six years later the banks are saying ‘okay, the model has proven itself, we will now bank it’. But the rates aren’t better, it’s still difficult to go through that process (of financing), and we’re going to see the same with affordable accommodation.”
About 150 000 people work in the Cape Town CBD, with accommodation for 7 000 people.
According to researchers from the CCID, on average 1 800 families per year migrate into the Cape Town metro from other parts of South Africa.
Despite concerns that AirBnB was inflating rentals in the Cape Town CBD, CCID communications manager and lead researcher on its annual report Carola Koblitz said the number of units on the online marketplace was exaggerated.
“I do not believe that there are as many AirBnB units in the CBD as they say there are.
“If you actually go on the (AirBnB) maps, and have a look when you draw down to it, you’ll find that there’s actually two or three or four (units) in a building like St Martini Gardens (in Queen Victoria Street),” said Koblitz.
She said the residential market seemed to have levelled off slightly.
“The rand per m² is still showing growth over the past six months, but we’re seeing less of an escalation in year-on-year prices than we’ve seen over the past few years, when property in the central city was still coming off a very low base.
“From December 2016 to June 2017, we’ve seen the rand per m² increase by 5.2%, from R33 921/m2 to R35 700/m2, as per transfers registered at the Deeds Office,” said Koblitz.