Cape Towns chic city pads selling like hot cakes
While the deteriorating economic landscape has not yet made a notable dent in the demand forCape Town’s chic city pads, agents for the Cape Town CBD and City Bowl caution sellers not to hold out for better prices. The time to sell is now, while the demand is still high and stock levels still very tight.
This apartment in Gardens, Cape Town, has one bedroom. It is selling for R1.8 million - click here to view.
This is according to Jason Paans and Warren Emett, Seeff’s agents for the CBD area, who say sellers should act now while the going is still good.
For now, they say apartments in the Cape Town CBD and City Bowl are still selling like hotcakes. There is also not enough new stock coming onto the market to meet the demand, thus leaving a window of opportunity for sellers who want to capitalise on the strong demand and higher prices that currently characterise the market.
The agents say market statistics show that good selling conditions still reign in the central city. Propstats shows that apartments in the CBD are selling twice as fast compared to five years ago, with the average sales cycle now at around 47 days. Well-priced units can sell within a week of coming onto the market.
Sellers are also now getting on average just 5% less than their asking price, and about half of all recent sellers have achieved just about or full asking price. The 130 units worth R231 million that have sold in the CBD this year have also sold at an average price of R2.167 million, 37% more than last year’s average of R1.58 million.
Paans and Emett say they are still seeing about a flat a day sell in the area. Of the 317-odd apartments worth almost R665 million that have sold across the entire City Bowl and CBD area this year, almost half are located in the CBD, clearly demonstrating a market still characterised by strong demand.
This one bedroom apartment in De Waterkant, Cape Town, is on sale for R2.25 million - click here to view.
“One and two bedroom flats are most in demand and we are selling them almost as fast as we can list them.”
They say more than two thirds of all sales this year have been above the R1.5 million price mark. At the top end, they have also seen about 23 units sell for upwards of R3 million, twice as many compared to the same period of January to October last year.
Popular complexes include Mutual Heights where a three bedroom unit sold for R3.8 million, the Colosseum where a two bedroom unit sold for R3.265 million and the sought-after The Studios where a two bedroom unit sold for R4.25 million.
Cartwright's Corner, Mandela Rhodes Place, The Adderley, The Wellington and Perspectives also continue to be hot selling blocks.
While older apartments are now selling for around R18 000 to R25 000 per square metre, new or renovated units can sell for as much as R30 000 to R40 000 per square metre, especially in high profile buildings such as those on the Foreshore, say the agents.
Paans and Emett say it is also mostly younger buyers that are drawn to the high life on offer in the city and almost half of all buyers are under 35 years of age. While the majority this year have been residential buyers, investors are still looking for good buy-to-let opportunities.
They say investors are swayed by the good returns and rental rates in the CBD. For example, a studio unit now rents out at around R7 500 per month, one bedroom units for around R10 000 to R12 000 and two bedroom units for up to R18 000 to R20 000 per month.
This apartment in Vredehoek, Cape Town, offers three bedrooms. It is on the market for R2.5 million - click here to view.
Location and convenience are the two big drivers of the demand in the city. Most of the more than 6 000 people that now call the CBD home, work in or around the area and, aside from being within walking distance of work, residents are also within walking or cycling distance of excellent facilities, say Paans and Emett.
For example, the latest CCID report says that most residents patronise the coffee shops, restaurants, theatre and film houses and retail stores in the area, and also attend big events held in the city. The most popular hangouts now are Kloof, Long and Bree Streets, along with the V&A Waterfront, the Camps Bay promenade and of course theAtlantic Seaboard beaches over the summer months.
Paans and Emett say the neighbouring De Waterkant is also still favourable for sellers. This year so far about 27 sales worth about R80 million has been recorded for the suburb at an average selling price of R2.95 million, 34% more than last year’s R2.2 million.
De Waterkant is also a hive of building activity with building upgrades underway to add further zest to what has become a trendy urban zone. Apartments in this area now comfortably sell for above the R1.5 million mark to as much as R6.8 million for a three bedroom unit in Harbouredge. Other popular complexes include Dockside and Soho on Strand.
On a rate per square metre basis, apartments can now achieve around R25 000 to R35 000 per square metre, up to 30% to 40% more than in the CBD, but can go as high as R50 000 per square metre depending on the location and finishes on offer, they say.
This two bedroom apartment in Cape Town City Centre is selling for R2.75 million - click here to view.
Agents Bernice Musikanth and Bryan Ginsburg, say market conditions in the surrounding City Bowl suburbs are also still quite favourable for sellers.
Buyers in this area are drawn to the more suburban ambience of areas such as the suburb of Gardens. It tops the list with the highest number of apartment sales in the City Bowl suburbs, excluding the CBD, with some 45 apartments sold this year at an average price of R1.765 million.
Vredehoek is yet another popular suburban choice for apartments, coming in with 37 sales for this year so far at an average price of R2.1 million. Although Zonnebloem with 34 sales account for the third highest volume in terms of apartment sales, it is still the most affordable with its average price only at around R900 000.
Oranjezicht and Tamboerskloof are the two most expensive areas for apartments in the City Bowl this year, with 19 sales at an average selling price of R2.23 million and 16 sales at an average of R2.56 million respectively.
Musikanth and Ginsburg say almost any well-priced apartment in the City Bowl now sells and quite quickly. For example, in Gardens sellers are now getting within 3.4% of their asking price, but most sales are concluded for the full asking price, if not more. The picture is similar in Vredehoek.
As in the CBD, market conditions continue to favour sellers across the City Bowl suburbs as well, but in this area too, the agents say sellers should not rest on their laurels. Property market economists are now warning that selling conditions are declining on an almost month-on-month basis.