What is driving the Western Cape property market?
The current economic climate is leaving its mark on the property market nationally, with both sales and rentals dropping. The Western Cape has not been immune to this malaise, but it has managed to remain comparatively robust, when viewed alongside markets in other provinces, with the occasional exception of Gauteng.
While the top end of the market has been hardest hit, the Western Cape has seen a shift, rather than a stagnation, to property purchasers’ and tenants’ preferring smaller, more affordable living spaces.
Smaller places in popular, well-serviced locations are winning out over larger homes and apartments in more out-of-the-way areas. Buyers and tenants are willing to sacrifice space in favour of a shorter commute or even being able to walk or cycle to work, and factors like proximity to shops, bars and restaurants.
Fin24 reports that with growing congestion and the rising cost of fuel, the distance that people are willing to travel each day is coming down rapidly and there is an increasingly strong desire to live close to work. One of the ways in which this can be achieved, is by living in a growth node which offers all these facilities. The Amdec Group’s R15 billion Harbour Arch development is a prime example of this.
With the building of hundreds of brand-new, top-quality apartments on the site of the former Culemborg automotive dealerships, along with shops, bars, restaurants, coffee shops, health clubs and hotels all on-site, Harbour Arch will attract people, jobs and money back into the city.
By offering so much more than residential property, this development proves that high density doesn’t have to translate into low quality of life. It also addresses two very big needs in terms of property in the city: proximity to businesses and offices, and an entry point into the market for first-time buyers. Young professionals gravitate towards a place like Harbour Arch because it offers so much freedom, with everything from state-of-the-art security to a host of public transport options. This leaves very little to worry about and lots more time to enjoy life. And even if they can’t afford to buy here, they are keen to rent, because it gives them access to this highly desirable urban lifestyle.
Despite the impact of a severe drought, the Western Cape has also continued benefiting from semigration, whereby people move here from within South Africa – primarily Gauteng – in search of better quality of life. And the lifestyle on offer in the Mother City is not only desirable to locals, but also attracts international tourists all year long. Tourism is therefore another driver of property value in the Cape.