Cape Town - South Africa’s millennials, people born between 1981 and 1996, are making their mark on residential property trends and using smart devices to search for houses, research neighbourhoods, and communicate with estate agents.
According to StatsSA, millennials account for almost 30% of the population and “represent the largest generation to enter the country’s workforce at 51%.”
Figures from mortgage aggregators confirm that the average age of the first time homebuyer reflects these statistics and that in 2020 and 2021, first time buyers made up the lion’s share of bonded home loan applications.
Estate agents who have tapped into this market, have been using previously unconventional platforms like TikTok and Instagram to market properties.
A recent TikTok video by Lew Geffen Sotheby's International Realty’s Richard Haubrich went viral attracting a majority of buyers, 47.4%, aged between 25 and 34 for micro apartments at One Thibault, the former Standard Bank building in Thibault Square in Cape Town’s CBD.
The micro apartments start at R895 000 for 19m² but one and two-bedroomed apartments are also available.
Haubrich said: “I am a digital creator by profession, but when Covid-19 hit, I pivoted and decided to try my hand in the property business.
“The TikTok video going viral was exciting, unexpected and overwhelming. While most of my buyers are from South Africa, I also landed on some from Canada and the US.
“Many are first time buyers looking for investments for under R1 million.
"We are really not targeting the apartments to people who want to live there, they are more for people who see them as an investment. So some are buying multiple units which will be used as Airbnb apartments etc once tourism picks up again.”
With interest rates still low, millennials and young families are using the opportunity to finally gain a foothold in the property market. It is now up to developers and estate agents to carefully tailor their offerings to this savvy group of new property buyers.
Director of online bond aggregator MortgageMe Andrea Tucker said: “Both here at home and in other locations across the globe, millennials show a preference for living in neighbourhoods with a sense of community and easy access to lifestyle-related amenities, trendy restaurants, and shops.
“This is why mixed-use developments are a popular choice among first-time buyers who are attracted to both the greater flexibility and control that comes with a village-style mix of retail, restaurants, office space and multi-family housing.
“South Africans are also attracted to the added safety factor of private estates and enclosed neighbourhoods, including strict access control, 24-hour security, a reduction in major traffic, dedicated parks, and children’s play areas.”
Meanwhile yesterday the SA Property Investors Network (Sapin) hosted a property roadshow in Cape Town for property investors on Thursday.
Sapin chief executive Andrew Walker said “Investing in property is for the long haul, so while some may have put their investment portfolio on hold due to Covid-19, there are current real opportunities in the Cape property market and it’s important to remain consistent, focused and committed to your investment strategy.”
During the event members of the public heard talks and presentations from different organisations and were given insights into advanced tools and tactics for property portfolio optimisation, including progressive investment strategies for expansion, property Investment exit strategies to mitigate risk and advanced deal analysis methods to avoid costly mistakes.