Cape Town’s Southern Suburbs are among the most popular neighbourhoods in the country, not just with locals, but also semigration and international buyers according to Francois Venter, a luxury property expert with Seeff Southern Suburbs.
For the upper end of the market which includes Bishopscourt, Constantia Upper, Newlands, Claremont, and Kenilworth Upper, last year was a property boom. In Constantia Upper alone, property sales amounted to some R1.5 billion, quite unheard of in recent years.
Sales above R20 million in Bishopscourt and Constantia Upper reached a record 19 sales last year. Venter said while the market has slowed from the pent-up highs of last year, it remains healthy and well-balanced across all price levels.
In Bishopscourt for example Seeff concluded a R39 million sale to a UK buyer recently. House prices now range upwards of about R25 million in the suburb while the average selling price for the first quarter is around R27 million, said Seeff.
In both Constantia Upper and Bishopscourt, buyers are around 50/50 South African versus international, mostly from the UK and Germany with most recent sales being international buyers. Some are “swallow” buyers looking to spend six months of the year here while others such as a UK buyer who spent R26 million on a home in Constantia Upper will be relocating to the Cape.
Venter said international buyers are finding exceptional value in the market. “For the price of a small flat in Munich, you can get a lovely home in one of the most beautiful cities in the world and a fabulous climate and lifestyle here in Cape Town.”
The Constantia Upper property market ended last year with a record 108 sales and a record R1.5 billion in value. This year is also off to a good start, according to Seeff. The average selling price for Constantia Upper in the first quarter was around R14.5 million.
Venter said that while about 75% of the market falls below the R15 million price range, there is greater demand at the top end of the market above R20 million, driven primarily by international buyers. Sellers achieved on average around 8.7% below their asking prices in the first quarter.
Both Claremont and Kenilworth Upper are popular with families for the great access to top schools. Claremont Upper is most active below the R8 million range while Kenilworth Upper is generally below R7 million. In both areas, sellers achieve about 10% below their asking prices.
Newlands is also popular with families with the R6 million to R7 million range being the most active. Properties are spending around three months on the market on average and sellers achieved about 7.8% on average below their asking prices in the first quarter.
Although sellers are potentially getting closer to their asking prices, Venter said correct pricing remains vital. Regardless of whether the property is in the R2 million or R20 million range, it will sell faster if priced correctly.
Cape Town offers a unique combination of lifestyle and investment value with the Southern Suburbs “Uppers” being a primary area. Venter said that a renewed focus on lifestyle and particularly quality living has bolstered demand and the outlook remains strong.
“Prices have remained fairly flat with subdued growth of around 3% to 4% in nominal terms which means it is a fantastic time to buy.”