Strong rental demand among mine contractors in Mokopane (formerly Potgietersrus) is underpinning the property market in this Limpopo town.

So says Esther van der Merwe, owner of the local RealNet estate office, who also reports that demand for furnished homes on short contracts is especially high.

"Contractors at the platinum mine between Mokopane and Ellisras find it cheaper to rent furnished units for their employees than paying for accommodation in guest houses,” she says.

“Short-term rentals of three-bedroom homes that can accommodate up to six employees at up to R12k per month are not uncommon in contrast to normal residential rentals of between R4k and R7,500 for unfurnished homes.”

Wendy Marshall, agent for Seeff Mokopane, says an increased number of mine workers have also caused a spike in residential buying activity. “Sales have tripled since November and the mines are a big contributing factor.”

Van der Merwe adds that activity has picked up, but financing remains problematic with long delays in processing bond applications due to the strict criteria of the National Credit Act (NCA). “In the past the whole process took around two weeks, but consumers now have to allow at least 60 days,” she says.

“This is exerting negative pressure on our market.”

Marshall says black buyers are exceptionally active in the Mokopane market. “Anything up to R1,5m is moving briskly, while the upper end has all but grinded to halt.”

Prices for townhouses currently range between R500k and R1m while full-title properties sell at prices of between R650k for smaller units to R2m.

Property prices have declined in the weaker market, in some cases by up to 40%. Van der Merwe says homes that sold for R960k 18 to 24 months ago are now offered at prices of as low as R760k. “Good value at current prices, coupled with the strong rental demand, creates excellent buying opportunities for investors who are not constrained by financing difficulties,” she says.

Marshall agrees that prices are still falling and says sellers are gradually realising that realistic pricing is still essential. - Eugene Brink

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