Property prices in these three South African towns are booming

 ·20 Jan 2024

Coastal towns in the Western Cape have seen double-digit growth, with property prices continuing to grow in the post-pandemic world.

According to Steven Neufeld, Manager Principal of Lew Geffen Sotheby’s International Realty Plettenberg Bay, the average house price increased by 31% in 2021 from R2.48 million to R3.92 million. Although prices only increased by 9% to R3.92 million in 2022, it spiked again last year by 26% to R4.84 million.

“Plettenberg Bay normally follows behind the Gauteng property market by about six months, but in this property cycle Plett bucked the trend due to the big post-Covid-lockdown semigration and continued to climb during Gauteng’s downturn,” Neufeld said.

“Essentially, prices increased as stock decreased, but the market slowed considerably in the second half of the year, and stock levels are starting to recover.”

Entry-level property prices in Plett have also increased over the last four years.

“These days, it is difficult to find full title homes below R3.5 million with sectional title unit prices starting at R1.3 million. Vacant land starts at about R550,000 in gated estates and R800,000 in open areas.”

“The majority of our buyers since 2020 have been from Gauteng and Plett itself with an even 50/50 split, followed by Cape Town (±12%) and international buyers (8%).”

“However, last year, local buyers nudged ahead of Gauteng buyers, and the number of international buyers increased to around 16% of all our sales.” He noted that many High Net Worth Individuals globally have started diversifying their portfolios and are buying property outside of the bigger markets in Europe.

Knysna is also attracting upcountry buyers who are looking to relocate their families, with the median house price increasing by 47.6% in 2022 to R3.1 million, and again by 12.9% to R3.5 million. This is far higher than the record-high median price of R1.7 million in 2017.

Semigration has also boosted the median house price in Hermanus by 51.4% in 2022 to R2.65 million. However, it did stabilise last year to R2.1 million.

Nevertheless, the median price of an estate freehold home is currently around R.7m and houses at the entry level are becoming scarce.

Images of properties in these three towns at various price points can be found below:

  • 5 Bedroom House for Sale in Signal Hill, Plett
  • Price: R19,500,000

  • 5 Bedroom House for Sale in Brenton On Lake, Knysna
  • Price: R7,900,000

  • 5 Bedroom House for Sale in Voelklip, Hermanus
  • Price: R4,950,000

Read: Major new high-end shopping mall in the works for South Africa – surrounded by sugar cane and farmlands

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