The exodus from “crime and grime” continues as families seek a better lifestyle. But economic opportunities are still the main motive for moving.
While some families move for a better lifestyle the most common reason for moving home is still for economic opportunity.
The general stagnation in the residential property market has also affected the phenomenon of families throwing in the towel of city life and moving to rural areas, in spite of the inherent disadvantages in terms of services – schools being a major consideration.
Nevertheless, the outward urban movement continues, if at a slower pace. In the past it has been largely driven by economic factors, with lifestyle considerations of secondary importance. But grime and crime plus deteriorating services and even traffic congestion have altered the pattern to some extent.
Country living created the great public schools of England. Landowners, country squires and farmers were forced to send their children (almost exclusively boys) away to be educated. Alternatives were private tutors or the village school (class distinction here). These days in South Africa, parents tend to send their children to boarding school because of the very high standards at these, relatively expensive, schools which have great reputations as seats of learning.
So schooling remains a factor in terms of rural living, but it is not the be all and end all. A recent survey of estate agents by FNB revealed that the primary drivers of relocation within South Africa are work transfers, business opportunities or seeking a better job. Secondary drivers are:
- Relocation for retirement
- Wish to escape traffic/congestion
- Need to move closer to children/family members
- To escape high crime levels
The fact is that most people don’t have the luxury of moving away from the main centre of economic opportunity. Thus a place which has a combination of economic opportunity as well as a great lifestyle would more or less be first prize. The Western Cape, for example, probably has the best balance of both. In fact FNB’s analysis, which is based on repeat buyers and Deeds Office data, indicates that the Western Cape comes out tops in net inward-migration. Furthermore, the Western Cape has fewer outward bound migrants and most of those head for Gauteng, with very small percentages going anywhere else. The bank’s property analyst John Loos, who likes to coin a phrase, calls this population movement “semi-gration”, referring to people re-locating to different parts of the country, as opposed to emigration, which refers to people leaving the country, intending not to return.
In the survey, agents estimate that approximately 7% of all sellers are selling in order to relocate to another part of South Africa. Those who move to find a better lifestyle are increasing plumping for country towns and villages. In the Free State, Clarens near Golden Gate is an example – an idyllic weekend retreat in which many families have settled permanently. PGP’s area principal, Anne Maree, reports an upturn in enquiries. Homes typically offer good value for money – a 3-bedroom, 2-bathroom house selling for between R700 000-R800 000.
In the Western Cape and Boland, popular Franschhoek is beginning to buzz again, as is Wellington, reports PGP’s Surina du Toit. There has been quite a drift to the small Karoo towns which offer reasonable amenities coupled with value for money properties. Coastal properties have been in the doldrums, but there are some areas of activity. Elwyn Schenk, area principal in Umdloti and Umhlanga, reports awakened interest, adding: “Coastal properties will always have that X factor.”
A feature of those attempting to escape the stresses of big city life is the growing interest in guest houses and B&Bs. Ling Dobson, Knysna area principal explains: “Such a purchase enables the buyer to live here while making a good living without having made an excessive outlay.”
Economic growth appears to dominate the semi-gration statistics, possibly because growth provides opportunities. Here the Western Cape is the leader of all eight provinces in terms of its ability to attract the best inflow of what the FNB survey describes as repeat buyers. It also has the lowest outflow and of this most families move to Gauteng for reasons of economic opportunity and, says the survey, have limited interest in other “good lifestyle” provinces.
How does the Western Cape have such good retention? Great lifestyles in attractive environments are found in other, smaller centres. Again, the answer probably lies in economic opportunity.
FNB’s John Loos comments: “Some may be surprised to hear that Gauteng is a more favoured semi-gration destination for Western Cape residents than the Western Cape is for Gauteng people, relative to the size of each province’s market. The Gauteng outbound distribution is more evenly spread across provinces, with a significant group headed for the other major coastal region.”
What it boils down to is this: add a good lifestyle to a strong economy and you have a winning recipe.
The costs of moving home are significant, so make sure you do your calculations properly.
RANDS AND SENSE
A vital consideration in relocating is the cost – which is not inconsiderable. Here is a rough guide with input from attorneys STBB.
Selling at R3 million (with estate agent’s commission 5%)
- Bond cancellation costs: R1 200 fees + VAT + electronic facilitation costs approx R60, post and petties R60. Deeds Office fee R70, electronic document generation fee R95. Approx total R1 695.
- Agent’s commission (VAT incl) R171 000
- Electrical certificate (varies – budget on between R900 and R1 800)
- Outstanding municipal rates
- Capital gains tax liability
- Cost of moving.
Buying at R2 million
The transfer and bond costs are as follows:
- Transfer duty R105 000
- Deeds Office R650
- Attorneys’ costs. Fee R17 500, P&P R650, others R265, VAT R2 555,70
- Total costs: R126 460
Bonds
- Deeds Office fee R700
- Bank initiation fee, varies from bank to bank but can be as high as R5 000
- Attorneys’ costs: Fee R13 400, approx R635 plus VAT
- Total costs approx R16 700
Articles courtesy of Pam Golding Properties' Intellectual Property Magazine.
Readers' Comments Have a comment about this article? Email us now.
Thanks for writing this article for the .0001% of the folks in SA. - John