‘Domino effect’ on homes near CBD
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Cape Town - Investment to the tune of billions of rand in Cape Town’s city centre is having a positive knock-on effect on neighbouring residential suburbs, with demand swelling for homes in areas within 10 to 15 minutes of the CBD’s businesses, trendy coffee shops and restaurants.
Explaining what she called the “domino effect”, evident in the City Bowl and Atlantic Seaboard, Cape Waterfront Estates’ Margie MacKenzie said growth in the CBD meant higher demand and prices in nearby suburbs.
The city centre had seen a number of new property investments,
such as the
32-floor commercial Portside building, the first skyscraper to be built in the city in two decades. It was completed recently at a cost of R1.6 billion.
The CTICC, meanwhile, is set to undergo an expansion with a price tag of more than R800 million.
Seeff Atlantic Seaboard and City Bowl managing director Ian Slot said the City Bowl and Atlantic Seaboard had been at the forefront of the current property “boom”.
“Anything priced below R3m is literally selling within a week to a month of listing,” he said.
“Apartments are literally flying off the shelf, especially below the R3m mark, while houses priced below R10m are finding buyers aplenty.”
Even at the upmarket Waterfront, there was significant demand for apartments selling for up to R24m, mostly from South African buyers.
Now there was also an increasing interest in the City Bowl and Atlantic Seaboard market from Africa, he said. Buyers from the United Arab Emirates, China and India had also made investments.
According to data compiled by Steven Delit of RE/MAX Living Atlantic, the average m² price for apartments in most Atlantic Seaboard suburbs had shown a steady year-on-year increase since 2011.
Mouille Point apartments, for example, saw an average m² price increase of 39 percent between 2011 and the first quarter of this year, from R26 075 to R36 303. But even apartments at the V&A, which come with an average m² price of R54 393, are not the priciest.
Granger Bay is more expensive, at R61 538. Bantry Bay was the only suburb to see a decline, dropping from R39 523 to R34 737 per m².
Vangelis Doucas, of RE/MAX Living Sea Point, said there was “an unusual amount of interest for the winter months… the buyers’ interest has picked up, contributing to serious stock shortages”. “
Prices have indeed picked up as a result, reaching record highs for several kinds of properties.”
Cape Town Partnership chief executive Bulelwa Makalima-Ngewana warned however that with the benefits of the CBD’s “prosperity” came the reality that low-income Capetonians were priced out of the city centre and its nearby suburbs.
Makalima-Ngewana said recently there were several pieces of government-owned land in the central city that could be considered for low-income housing.
“Rental housing properties are another way to place low-income earners with steady jobs into a well-supported environment with increased access to community programming opportunities, such as child and healthcare facilities,” she said.