Where to find great value fixer-upper property in Cape Town and surrounds
Category Property News
Unrenovated character houses have become an increasingly scarce commodity in Cape Town, especially in areas like the Atlantic Seaboard and City Bowl where most were snapped up during the past decade. However, there are pockets where original homes and good value can still be found, but in a decidedly buyer's market, realistic pricing is critical.
"There are still a number unrenovated houses in the suburb and there is definitely strong demand for accessibly priced fixer-uppers, but sellers must remember that investors are spoilt for choice in the current market and, better informed than ever, most are unwilling to pay above market value," says Stephen MacPherson, Area Specialist in Pinelands for Lew Geffen Sotheby's International Realty.
"All too often nowadays we see homes sitting on the market for months despite keen buyer interest, while similar properties in the area are snapped up. A case in point is one of our most recent sales, a lovely older home which we listed for R3.75 million - and sold in just 10 days for R3.55 million."
MacPherson attributes longer time spent on the market largely to two reasons: sellers are either unwilling to adjust their pricing expectations, or they have assumed that the highest valuationthey received was the best valuation.
"Unfortunately, in many cases the agents are the root cause of the problem, often times over-valuing properties by as much as a million, usually in an effort to secure sole mandates in a competitive market," he says.
"Or when sellers adamantly stick to their high prices and agents are nervous to oppose their decision too strongly for fear of upsetting or losing the client, some would rather allow certain homes be over-priced as other properties will seem like great value for money in comparison."
"Pinelands is currently one of the more active markets in Cape Town," says Arnold Maritz, Southern Suburbs co-principal. "Over and above the availability of original homes, it offers great value compared to neighbouring suburbs like Rondebosch."
Maritz says current Lightstone data corroborates the ongoing demand for property in Pinelands and highlights the current values.
"During the past 12 months ending 31 March, 103 freestanding houses were sold at an average sale price of R3.67 million, of which 25 were in the R1.5 million to R3 million price band averaging R2.73 million, while 79 properties sold for more than R3 million at an average sale price of R3.96 million."
Although False Bay has become increasingly popular in recent years, with most areas along the coastline undergoing significant upgrades, Maritz says that there are still gems to be found here.
In older established suburbs like Kalk Bay and St James, many of the current owners have lived in their homes for many years and only sell when the time comes to downsize or move to a retirement facility, says Maritz.
Buyers looking to invest in renovation properties further away from the city should look in the smaller Boland towns, says Chris Cilliers, CEO and Principal of Lew Geffen Sotheby's International in the Winelands.
Older homes in or near the centre of Paarl and Stellenbosch are now few and far between and have therefore become pricier, but there is still excellent value to be found on the outskirts of towns where upgraded homes are quickly increasing in value, says Cilliers.
Wellington is also generally very well priced and still has a number of character homes, and those who want an even quieter village lifestyle should look in places such as Tulbach or Riebeeck Kasteel.
Cilliers says value and good returns can still be found in all the Boland towns - if one knows where to buy.
"Even areas that weren't considered prime usually quickly increase in value and become very sought after once they begin to be upgraded. Northern Paarl is a great example, as well as Onderpapegaaiberg, Simonswyk and Uniepark in Stellenbosch," he says.
Regardless of which area you invest in, to achieve maximum returns it pays to remember that there are a couple of universal criteria over and above pricing: if you buy close to good schools and amenities with easy access to main routes, you will always find a tenant or a willing buyer when the time comes to sell, says Maritz.
Author: Lew Geffen Sotheby's International Realty