A surge in uptake in vacant land along the Garden Route and Eastern Cape coastline provides a clear indicator of a market turnaround in these coastal locations, with buyers looking to acquire plots for diverse reasons, including primary residences, retirement, leisure or investment, reports Pam Golding Properties.
In Mossel Bay on the Garden Route, Pam Golding Properties (PGP) area principal Keith Murray says upcountry buyers are looking at acquiring vacant land, with enquiries for locations ranging from the Monte Christo area all the way through to Nautilus Bay and Vleesbaai, at prices varying from R280 000 up to R1.5 million. “They are looking at building over buying second hand homes, saying it makes financial sense to build as currently many of the existing homes are still overpriced.
“Our sales of vacant land range in price from R250 000 for about 700sqm to R650 000 for approximately 650sqm in Mossel Bay Golf Estate and Pinnacle Point Beach & Golf Resort, to R1.85 million for up to 1200sqm in a golf estate. Purchasers are mostly from Johannesburg, Pretoria, Bloemfontein and upcountry towns, and are a mix of those buying leisure properties, retirement and permanent homes. They seek land in various areas from residential suburbs to golf estates and gated communities. What we are seeing is that price is more of a motivating factor than location, and that buyers have more appetite to invest long term – preferring to build exactly what they want. Golf estates are perceived to be a safer environment because of the access control, especially for upcountry buyers who are used to living in some form of an estate.”
Murray says the market for completed homes is mainly in the R1.2 million to R1.6 million price band, largely for freestanding homes, with buyers including locals and those from Gauteng and KwaZulu-Natal.
Buyers prefer to build
Vacant land is also in demand at renowned Fancourt near George. “People are buying land as the number of existing homes on the market is low and so they are opting to build according to their own specific needs, whether these are second homes or primary residences,” says Stephen Murray, area manager for PGP in George.” In Kingswood Golf Estate buyers acquiring vacant land are mostly looking to build primary residences, as well as some investors who have picked up on the shortage of built homes within this estate and are catering for the demand.
“During 2014 sales prices of vacant land in Kingswood were generally between R350 000 and R800 000, while our analysis of transfers over the past four years from 2011 to 2014 (using Lightstone statistics) reflects that on average a vacant stand positioned on a fairway attracts a premium of about 39 percent, with offers being received in the R1.4 million mark. During 2014 in Kraaibosch Manor and Kraaibosch Estate sales prices were in the main in the price bracket from R300 000 to R500 000 and purchased with a view to building a permanent residence. Most buyers of vacant land in our vicinity are from Gauteng and the Western Cape, as well as those who have been renting in the Garden Route after relocating – in order to settle in the area before making a purchase decision. The demand for vacant land has been fuelled in part by the perception of security within a gated estate and partly the lack of available houses in certain price ranges within the general market place,” says Murray.
Highest price achieved for a stand in St Francis Links
In St Francis Links in the Eastern Cape, Pam Golding Properties area principal Richard Arderne reports the sale of the highest priced plot since 2008 in St Francis Links golf estate – a stand of 1273sqm which fetched R1.4 million. This exceeded the previous highest price of R1.25 million for a plot which sold in 2012, also through PGP. In Port St Francis, PGP also recently sold the highest priced residential property in the area – a four-storey townhouse with four bedrooms all en suite, which fetched R3.75 million, exceeding the previous highest price of R3.5 million for a four bedroom apartment which sold in 2007.
“The past financial year to 28 February 2015 has seen us achieve our highest ever sales turnover of R105 million, which accounts for well over a third of total market sales in the area across all agencies. We also concluded a record number of sales, 65 units in total, comprising 29 houses, 29 plots and seven apartments, ranging from R125 000 plots to R4.5 million canal houses. About a third of our sales were to local St Francis Bay residents, with other buyers from Gauteng, Cape Town and Durban purchasing leisure property, Port Elizabeth families acquiring weekend getaways, and couples in their 50s and 60s purchasing for semi- or full retirement. Although turnover is up, prices remain under pressure with more sellers than buyers at present,” says Arderne.
Plan approvals up in Knysna
Ling Dobson, Pam Golding Properties area principal in Knysna and Plettenberg Bay, says there has been a 35 percent increase in plan approvals in Knysna over the past 12 months to March 2015, with 12 new builds commencing in Pezula Private Estate this year. ”Vacant stands in this estate are selling in the price range from R800 000 right up to R16 million for a large site of 11 135sqm, with 400-1600sqm plots in Fernwood Private Estate, which launched in December 2014, selling from R375 000 up to R1.95 million and with construction of the first home to commence in May this year (2015). In the ‘Woodlands’ development in Simola Golf & Country Estate, ground has already broken for the first home.
“Buyers are from around the country, including the Garden Route, Cape Town and surrounds, Gauteng, KwaZulu-Natal and the Free State. Furthermore, there has been buoyant activity in the R4 million upwards price band in the suburbs of Rexford, Eastford, Leisure Isle, Thesens Islands, Brenton on Lake and Brenton on Sea and the Knysna CBD, while completed golf estate homes are being mopped up in the R2 million to R3 million price range.” Top end homes sold by PGP include R9.5 million for a nine bedroom home on The Heads and R8.9 million for a five bedroom home in Pezula Golf Estate.
Return of retirement buyers in Sedgefield
In Sedgefield, James McNaughton, PGP’s local area principal, says retirement home buyers have rebounded into the market with renewed vigour, along with younger purchasers and ‘hobby’ farmers. “The market has improved in the price range largely up to R2.6 million, with even a few cash buyers above R2.5 million and with selective buyers in the upper price range, seeking to discount prices.
“Interest has definitely picked up, and sellers are becoming more realistic and adjusting prices accordingly. For example, stands on the seafront are now being offered from R1.4 million, while houses range from R3.5 million to R8.95 million. We recently sold a lagoon-front property for R3.2 million and a 50ha lifestyle farm with 1km river frontage on the Goukamma River for R7.8 million. The owner of this farm, who hails from Pretoria, has sold his business and intends to build his dream home on the hill top. The farm does not have agricultural potential but has the rare ingredients of extensive water frontage and spectacular views down the valley to the sea.”
McNaughton says the bulk of home buyers are from Gauteng, KwaZulu-Natal, Port Elizabeth and other upcountry locations. “Generally we attract the 50-70 age group, however there is an increasing number of younger couples looking to buy for the future – some looking to rent as an interim measure and contributing towards a current shortage of rental properties in the R4 500 to R6 000 per month price range.”