WORDS: HOMEFRONT REPORTER :: PHOTOS: UNSPLASH
The allure of seaside living has sparked a housing boom in the Western and Eastern Cape as buyers seek out the attractions these coastal towns offer.
Housing markets of towns in the Western Cape and Eastern Cape have become major drivers of property price growth over the past 12 months. This is as the demand for the coastal lifestyle reaches an all-time high.
Bradd Bendall, head of sales at BetterBond, says that the Western Cape recorded the largest average home price increase over this period, which is 35% higher than the national average. A perennial top performer, the province has seen a 10% increase in property prices from August 2022 to the same time this year.
While this performance is not unusual in the Western Cape — the country’s semigration hotspot accounting for 35% of all buyer relocation activity in the past year — it is noteworthy that the neighbouring Eastern Cape is showing similar house price growth. According to the September 2023 BetterBond Property Brief, house prices in the Eastern Cape have increased by just over 8%, recording the second-highest increase year on year.
Smaller seaside towns
“The rise of the Eastern Cape, notwithstanding its natural beauty, unspoilt coastline and enviable lifestyle, seems almost counterintuitive,” says Bradd Bendall. Lightstone has reported that the province is one of the most undesirable in the country, with slow population growth and limited economic opportunities. However, the Eastern Cape’s property boom is being driven by its smaller seaside towns offering great lifestyles for families relocating from Gauteng and other provinces.
In July, Lightstone reported that property prices in the Eastern Cape are highest in the region’s smaller towns. Homes are selling for an average of R2.4m in Cape St Francis and R2.1m in St Francis Bay. “St Francis has seen a huge influx of new families moving into the area as semigration continues,” says Barry Davies, COO of Chas Everitt. Another popular holiday destination is Port Alfred, where the average sales price is R1.5m, says Bendall. By comparison, average house prices in Gqeberha are considerably lower at R840,000, according to data from Property24.
Upmarket areas
While the Eastern Cape’s exceptional performance in terms of house price growth and sales volumes comes off a relatively low base, the Western Cape is a long-term top performer. Davies says markets in this province attract buyers in the higher price bands. Cape Town is home to some of the country’s most upmarket residential areas, including Clifton and Bantry Bay on the Atlantic seaboard.
The province also attracts high-net-worth individuals who are able to spend many millions on property. These buyers look to the picturesque Boland towns of Franschhoek, Paarl and Stellenbosch in the Cape winelands area. The coastal town of Hermanus is the fastest-growing area in the province for high-net-worth individuals, according to the “Africa Wealth Report” for 2023 published by Henley & Partners and New World Wealth.
The Western Cape has become the province of choice for home buyers looking to relocate, in light of its efficient service delivery and economic opportunities. It is also home to many excellent schools, some of the country’s best tertiary institutions and world-class medical facilities. Many of these assets are in Cape Town, rated by municipal financial sustainability index, Ratings Afrika, as among the top performing municipalities in the country.
George and Mossel Bay also scored well, ranking first and third. As a result, these coastal towns have also enjoyed considerable growth in recent years, says Bendall, especially as hybrid working arrangements have become common practice for many. A renovated home at the Point, in Mossel Bay, recently sold for R39m, the highest price yet in the area.
Competitive prices
Bendall says that these popular coastal towns offer enviable lifestyles and competitive property prices and are no longer viewed only as holiday destinations. Although demand is driving house price growth, with Lightstone reporting a 7% price inflation of coastal properties compared with the 2.4% growth of prices of inland properties, they are still accessible to many buyers. “With so much to offer it is understandable that the number of people relocating to the coast has increased from 31% in 2018 to 46% currently,” says Bendall.
