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Increased demand for luxury homes

Increased demand for luxury homes

One of the noticeable trends in the residential property market this year has been a discernible uptick in demand for luxury homes over R10m.

One of the noticeable trends in the residential property market this year has been a discernible uptick in demand for luxury homes over R10m – a sector where freehold properties have enjoyed an increase in demand, says Andrew Golding, chief executive of the Pam Golding Property group. “Much of this demand has been driven by local buyers who have identified specific areas of interest and understand that the current market, characterised generally by motivated sellers and well-priced stock, presents opportunities which offer exceptional value for money.

“In regard to freehold homes, these have clearly benefited from lockdowns and the shift to remote working, experiencing 6% price appreciation since the start of the year compared to 3% for sectional title homes. 

Increased demand for luxury homes

“That aside, generally we find that in the apartment living genre, penthouses are highly sought after and, due to their nature, limited in supply and as a result yield very good returns on investment, enjoying a premium of 20%-25% over other apartments in the same building. They are luxurious and spacious – usually with the very best finishes and features such as large windows with abundant natural light, expansive patio and private swimming pool and, importantly, offer privacy, often with their own elevator and entrance. Penthouses such as those in Cape Town’s V&A Waterfront, can fetch above R40m.” Golding adds: “We’ve also seen a notable increase in demand for properties listed above R10m on the Cape’s globally renowned Atlantic seaboard, particularly in upmarket Camps Bay and Clifton, where recent high-end transactions concluded by our agents extend to homes achieving individual prices of R70m.”

“Prices of sales which we’ve concluded in Baronetcy Estate range from about R10.5m to in excess of R60m. Interestingly, we’ve also noted an increase in demand from UK and American buyers in our area,” says Pam Golding Properties area principal for Cape Town’s northern suburbs, Pierre Nel. Secure estate living ticks all the boxes for many home buyers on the Cape’s western seaboard, where Emarie Campbell, Pam Golding Properties area principal, cites Atlantic Beach, Water’s Edge Estate, Waterstone Isle and Sunset Links as popular among such buyers, offering highly appealing, luxury living in a secure environment.

In Gauteng, Lambert Bezuidenhout, Pam Golding Properties area principal in Steyn City, says heightened activity in the upper price band has been more of a catch-up than a recovery, having been stifled by the stringent lockdown measures. “The majority of our sales are around the R20m mark for completed houses, with sales of more than R35m and upwards not uncommon. However, while land is still available from just more than R3m, many purchasers then make a further capital investment in luxurious high-end homes which may ultimately enjoy a market value of up to and in excess of R60m. Of our 14 highest recent sales, all except one were to South African buyers.

“Covid-19 has brought with it the notion that we might be living with it for some time to come, which implies that lockdowns and ‘work from home’ will affect a significant portion of the high-end buyer population. As a result, we’ve seen a trend towards larger properties – even in apartment sales – to accommodate the work-from-home’ way of life. Lifestyle estates such as Steyn City, with its diversity of homes, offer an abundance of outdoor spaces, facilities and activities, which also greatly enhances apartment living. Buyers believe that if they are going to be in lockdown, it should be in a space that facilitates some form of normality.”

Increased demand for luxury homes

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