Western Cape Real Estate Outperforms the Rest of South Africa

“House prices may not be where they were during the boom of 2008, but they are slowly creeping up,” says Mike Greeff, CEO of Greeff Properties, the exclusive Affiliate of Christie’s International Real Estate in Cape Town, South Africa. Greeff was commenting on the FNB Western Cape House Price Index for the 2nd quarter of 2012 which showed further year-on-year house price growth acceleration. It rose from a rate of 7.5 percent in the previous quarter to 8.7 percent, making this the fourth consecutive quarter of year-on-year growth acceleration.

According to Clinton Martle, Western Cape Property Leader Sales Manager for FNB, this price growth is very slightly above the national average year-on-year growth rate of 8.6 percent for the 2nd quarter. “The Western Cape, and in particular the metro areas of Cape Town have consistently outperformed other provinces in South Africa, indicating that more and more fans of the Cape are putting their money where their mouths are and actually investing in the province with a view to migrating," says Mike Greeff, adding that the majority of the sales are in the “affordable” category priced from around R800 000 to R2.5 million, and many of these buyers are Cape based, first-time buyers or residents moving due to  growing or shrinking families with either school or varsity going children, or they are downscaling due to retirement.

“The slow but constant rise in property values is not merely a lucky coincidence or solely attributed to the natural beauty of the Cape, although admittedly this plays a massive role, it’s largely due to buyer sentiment which continues to remain positive regarding investment in Cape real estate,” says Greeff adding that this is, in no small part, helped by local government. Greeff was referring specifically to a report by News 24 which reveals that City of Cape Town is by far the best performer out of all the municipalities in South Africa. This was judged based on the number of issues which had been addressed and “fixed” as well as the number of ideas implemented; The City of Cape Town is reported to have fixed 307 of 357 issues scoring 85.99 percent. Tshwane was second with 77.24 percent having fixed 2287 of 2961 issues. City of Johannesburg Metropolitan Municipality came in last with a score of 39.59 percent, having fixed 1169 issues out of 2953. Cape Town implemented 18 ideas out of 31, scoring 58.06 percent with the nearest competitor being Ethekweni Metropolitan Municipality with two ideas implemented out of the nine put forward, giving them a score of 22.22 percent. The poorest performer in this category was Mangaung with zero percent implementation of the five ideas that had been put forward.