Wealth

Cape Town city centre property prices reach eye-watering levels

Staff Writer

 ·22 Feb 2017

Property group Seeff says that property in Cape Town’s City Bowl has shunned a flat economy with record turnover and price levels.

Despite flat year-on-year performance in terms of the number of properties sold, the overall value generated reached a record high of around R2.36 billion last year, double that of 2010 (R1.16 billion) and 19% more than the R1.9 billion generated in 2015, Seeff said.

In the post 2007/8 period, the CBD and City Bowl suburbs were among the worst performing in the city. Properties often sat on the market sometimes for up to 180-250 days.

By 2015, the time that it takes to sell had improved to below 50 days on average. Last year, despite the declining economy, it dipped further to around 42 days on average, indicative of quite a healthy market, said Billy Rautenbach, sales director for Seeff’s operations across the area.

Five years ago, sellers were getting offers of 10%-20% below the asking prices on average, Seeff said.

Read: Green light for R1 billion Cape Town CBD development

“By last year, this had halved to around 5%-6% despite the higher prices achieved. In reality about half of all deals are still concluded for almost full price. A notable upside surprise is the phenomenal year-on-year growth in the average selling prices of 17%-18% measured overall for the market,” Rautenbach said.

While the overall volume of sectional title sales remained flat year-on-year, the full title sector enjoyed a 9% increase to 140 unit sales, up from 128 in 2015. The total rand value increased by as much as 28% to over R1.071 billion, the property group said.

It noted that year-on-year growth in the average selling price rose 17% to R7.6 million, up from R6.5 million in 2015 and about twice as much as the 2010 average of R3.6 million.

FNB data on the average house price in South Africa’s major metros revealed the following:

The sectional title sector continues to be very active, both in the CBD and surrounding City Bowl suburbs, Rautenbach said. The total value of sales for 2016 by 11% from just over R985.859 million to well over R1 billion.

The average price per unit sold increased by 18% from R2.2 million to almost R2.6 million, Seeff said.

It added that 2017 is already off to a busy start with January sales of R205 million for the whole area, a notable almost 40% more than last year January.

FNB: major provinces’ house price average:

• Western Cape – R1 256 372
• Gauteng – R1 016 804
• KwaZulu Natal – R988,142
• Eastern Cape – R815,914
• Other 5 provinces – R803,692

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