Semigration continued to bolster the Cape Town market in 2022, with strong demand precipitating stock shortages in some areas and a notable drop in the difference between asking and selling prices in most areas, especially in the Southern Suburbs, where top schools and lifestyle are key attractions.
“The Western Cape is receiving the lion’s share of the attention as the Southern Suburbs is the most popular destination amongst upcountry and foreign buyers for a number of reasons, including the fact that the province is also perceived to have better governance and service delivery,” says Claude McKirby, Co-Principal for Lew Geffen Sotheby’s International realty in the Southern Suburbs and False Bay.
He adds that, with more people having moved to the Western Cape (3317) during 2022 than to Gauteng (1639) and KZN (822) combined, it’s no surprise that this province is now home to nine out of ten of SA’s top suburbs according to Lightstone’s average transfer values.
“We are receiving enquiries for both sales and rental properties and very often people looking to buy will rent first whilst they search for a home to buy, especially if they don’t yet know the area very well. “Gauteng buyers are generally more interested in properties in secure estates but freestanding homes near good schools are also highly sought-after.”
McKirby says that the high-end market has also been very resilient, notwithstanding the weaker economy: “Last year was one of our Constantia Upper Team’s best years to date and they recently won the National Turnover award in the Sotheby’s group for their 2022 results which surpassed the R300 million mark. “In the Constantia market, the median prices have increased by over 10% between 2021 and 2022 based on registered sales
“The average price has increased by more than that, indicating that more high-end properties sold in 2022 than in 2021 and that prices in this price band are seem to be holding their ground. “Our Security Estates team also did exceptionally well last year with sales topping R100 million. The CMAInfo data for 2022 compared to 2021 shows a slight reduction in volumes of high-end property sales across our market, but an increase in the median selling price.”
He adds that transfers in Steenberg Golf Estate, Stonenhurst and Silvertree alone exceeded R365m last year. A clear indication of the market’s strong recovery since the pandemic is the shrinking gap between asking and selling prices. According to Propstats, in 2020 freestanding homes in Claremont and Claremont Upper sold for 10.1% and 11.6% below asking and last year this figure had shrunk to 6.8% and 7.8%.
In Rondebosch the 2020 discrepancy was 12.3% and in 2022 it was 8.1% and in Newlands the gap shrunk from 10.6% to 7.6% during the same period. According to McKirby, there’s also been a notable uptick in enquiries across the whole Cape Peninsula from Muizenberg to Noordhoek since mid-2021: “This scenic coastal strip not only offers the quintessential seaside village and outdoor lifestyle, it does so at more accessible pricing than most comparative coastal areas and it also offers a very broad selection of properties.
“Stock is becoming an issue, especially in the more sought-after areas with good schools. We are currently experiencing shortages in the Southern Suburbs and I believe the same is starting to happen in the Northern Suburbs as well.” Semigration is not only driving the relocation of families, but also businesses to the region and this has resulted in a spike in the demand for business premises, both to buy and to rent. “We are starting to see a very high buying demand, with the total value of our current enquiries now standing at around a billion and, bucking the recent trend for industrial properties, the majority of queries are for office space and retail premises.”
