31 Jul 2008
The Eastern Cape town of Jeffrey's Bay is currently experiencing a huge development boom, in spite of a short-term moratorium on development in 2007.
Property sales are healthy, both in new developments as well as in the second hand market, and the trend towards holiday homes seems to be changing to more of a residential focus, says Hennie Griezel, principal of the local Realty 1 International Property Group franchise.
"This is a very specific market. Supertubes is the most popular surfing beach in the world, and in July every year surfers from all over come here to compete in the various events. Not only does that boost the holiday rentals, but many of them can afford to buy properties. Professional surfers can earn in excess of R1m in a month, and with the current exchange rate, it's cheap in their terms."
Griezel cites the example of the Tides, a luxury development comprising six apartments right opposite the famous beach. Three of the six 160 sq m apartments have been sold at prices ranging from R2,2m for the ground floor units to R2,5m for the upper levels.
"Although these units have been sold as holiday homes, there's a strong trend recently towards sales for permanent residential purposes as well," says Griezel.
"There are many people who have relocated to the town from places like Gauteng, Germany, Switzerland and other countries who are CEOs of companies and can run their businesses online."
Griezel highlights the example of a property recently sold for R3,5m. "It's a four bedroomed, freestanding house of 456 sq m with the most spectacular views and it was sold as a permanent residence."
Evidence of the residential boom can be found in deeds office data, which shows that house sales in Jeffreys Bay have increased by over 2000% in the twelve months from April 2007 to March 2008, compared with the previous twelve months. Over the same timeframe, sectional title sales have increased by 45%, and the average sectional title selling price has gone up from R843,552 to R1,051,523.
The wave of semigration has also resulted in a commercial boom for the town. Demand for offices, retail property and business premises is high, and the existing Loodts industrial area is insufficient. Construction is currently underway on the Fountains shopping centre which will add 40,000sq m of retail space to the town, while another shopping centre of 18,000sq m is 92% sold out.
All this will be needed to service the residents of the 20-odd new developments that have gone up over the past two years, says Griezel.
"We will even have our own hospital soon. A hospital group just bought a site and is planning a new 65-bed hospital."
Jeffreys Bay caters for everyone, from senior citizens to golfers. Griezel explains that there are two new retirement villages in progress. The Fountains retirement village is a life-rights development, while the Rue de la Mer is an Only Title option.
For the golfers, a new golf estate is going up 15 kms away in Humansdorp, and phase one of a Jeffreys Bay golf development launched on 6 November last year. The latter is 95% sold out, says Griezel, at prices ranging from R299k for a 250sq m stand to R2,5m for a 1,000sq m stand.
And what about rentals? "There is a big demand for rentals at present, but we don't' always have stock to satisfy the market." Holiday rentals in particular are in demand over the festive season, when the number of people in the town increases from around 50,000 to over 120,000.
In spite of all this, says Griezel, the market has definitely slowed over the past six months.
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