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These are the Western Cape holiday property hotspots to invest in

23 Jun 2019

The slowdown in the Western Cape’s coastal property market has been a boon for South African holiday buyers, given that price growth has halted in the high-demand hotspots, barely keeping tread with the CPI rate.

This 187sqm apartment in Camps Bay, Cape Town, offers two bedrooms, two-and-a-half bathrooms, and open-plan living area flowing onto a large terrace with ocean views. It is selling for R11.5 million - click here to view.

This means that you can find excellent value along with motivated sellers, according to Seeff’s agents.

Holiday properties are increasingly sought as people look for alternatives to traditional hotels, often now choosing Airbnb, or, preferably to invest in their own holiday apartment which can then be rented out when not in use, says Natalie Muller, rentals manager for Seeff Atlantic Seaboard.

Despite the depressed economic conditions, beach apartment sales of almost R2 billion have been concluded in the Cape metro since the start of 2018, over 60% of the value generated on the Atlantic Seaboard - on Victoria Road (Clifton and Bantry Bay) where R447 million sold at an average of R22.3 million and highest price of R80 million, and on Beach Road (Sea Point and Mouille Point) where R763.8 million sold at an average of R7.6 million and highest price of R28 million, says Muller.

This three bedroom, three-and-a-half bathroom apartment in Bantry Bay, Western Cape, offers direct elevator access, an outdoor terrace and pool area, and good security. It is selling for R33.25 million - click here to view.

Nineteen of the highest prices paid on the Atlantic Seaboard were for beach apartments. These include six sales in Bantry Bay (highest price of R80 million), four in Mouille Point (highest price R40 million), three in Clifton (highest price of R42 million), two in Camps Bay (highest price of R28 million) and two at the Waterfront (highest price R26.5 million).

In the Blouberg area, beach apartment sales of around R240 million were concluded, predominantly in the Wave’s Edge, Bloubergrant and Big Bay areas at an average price of R1.8 million and R2.2 million, and a highest price of R4.45 million (Eden on the Bay) and R4.72 million (Wave’s Edge). In the Strand area, beach apartment sales clocked up around R188 million for 2018 alone at an average price of R1.775 million.

This two bedroom, two bathroom apartment in Big Bay, Blouberg, has extra high ceilings, large patio and communal pool. It is on the market for R2.55 million - click here to view.

Generally speaking, Seeff’s agents say you can now find a good holiday property from around R2 million in the Blouberg, False Bay, Strand and Gordon’s Bay areas, and in the top-end Atlantic Seaboard areas such as Sea Point, holiday homes are priced from around R6 million and upwards of R12 million to R40 million in top-end areas of Clifton, Bantry Bay, Mouille Point and the Waterfront.

Cape Town offers South Africa’s longest coastline and highest number of beaches (most with Blue-Flag status) to be found in Clifton, Camps Bay, Llandudno, Muizenberg, Fish Hoek, Gordons Bay (Bikini Beach), Strand and Bloubergstrand. Most of these are fronted by apartment complexes.

Seeff unpacks what it costs for holiday investments in the buyer hotspots:

1. Gordons Bay - holiday apartments from R500 000

This two bedroom, one bathroom apartment in Whispering Pines, Gordons Bay, is close to the beach and amenities. It is selling for R890 000 - click here to view.

Gordons Bay is famous for the Blue-Flag Bikini Beach and yacht-lined bay, and offers easy access from the airport.

Louelle Lubbe, Seeff’s licensee for Gordons Bay, says the area is very affordable with apartment prices from just R500 000 and houses from R1 million. Beach and sea-view properties range from R4 million to R6 million. On the Mountainside, you can find luxury houses overlooking the bay, from around R6 million to R20 million.

Harbour Island is attractive for holiday buyers, offering apartments in the R1.5 million to R3.5 million range, houses from R2 million and luxury waterfront homes with yacht/boat moorings from R4 million to R14 million.

2. Strand - beachfront apartments from R900 000

This apartment in Strand Central, Western Cape, offers two bedroom suites, gorgeous views from every room, good security and easy access to amenities. It is on the market for R2.55 million - click here to view.

The upgraded Strand promenade is lined with restaurants and attractions such as a waterpark, putt-putt for children and an Olympic-sized swimming pool.

Alten Vermaak, Seeff’s licensee for Strand, says easy access from the airport makes it a popular holiday destination.

He says Beach Road is lined with apartment complexes which, at an average price of R17 842 per square metre is still very affordable compared to Blouberg and the Atlantic Seaboard. Apartment prices here range from R890 000 to R8 million.

There is an excellent choice of apartments including new complexes which offer top security and luxury amenities. Topaz, for example, has a games room, gym, sauna and swimming pool. Hibernian Towers also has a pool, gym and sauna, as well as restaurant, retail and other services on the ground floor. Ocean View is another popular option. All apartments offer stunning views and modern finishes.

3. Blouberg - beachfront apartments from R1.4 million

This three bedroom, two bathroom home in Bloubergrant, Western Cape, offers open-plan living areas with views of the Table Mountain and Atlantic Ocean, a large balcony, communal pool and is within walking distance of the beach. It is on the market for R3.295 million - click here to view.

As a holiday and kite surfing destination, Blouberg is an excellent choice for holiday investments, according to Clinton Martle, Seeff’s licensee for the area.

There are a significant number of complexes to choose from, all close to leisure/retail hotspots such the Marine Circle area, Seaside Village, Eden on the Bay, and Blue Peter and Ons Huisie areas in the Bloubergstrand village.

Beach apartments are selling for around R24 000 to R34 000 per square metre and for new luxury units R40 000 to R71 000 per square metre based on Propstats sales data. Prices here range from R1.4 million to R3 million on average, and for new developments from R6 million to R21.5 million for a top end luxury unit in the new C’est La Vie development. Big Bay achieves R20 000 to R40 000 per square metre and prices of R1.4 million to R2.8 million on average.

4. Muizenberg/Fish Hoek - holiday apartments from R1.5 million

This two bedroom, two bathroom apartment in Fish Hoek, Western Cape, is selling for R2.395 million - click here to view.

The Muizenberg/Fish Hoek area benefits from the slightly warmer False Bay sea and is one of SA’s top surfing hotspots, according to Paddy Mow, an agent with Seeff who specialises in beach apartments.

It is a high-demand holiday area and increasingly popular with holiday investors. Here you can expect to pay R1.5 million to R3.5 million on average. Holiday rental rates range from R1 000 to R3 000 per day depending on the season.

5. Mouille Point/Waterfront - waterfront apartments from R4 million

This three bedroom, three bathroom apartment in the Waterfront, Cape Town, offers an open-plan entertainment area, deck with canal views and is close to many amenities. It is on the market for R21 million - click here to view.

While the Atlantic Seaboard offers a wealth of apartments, Mouille Point and the Waterfront are particularly well suited to holiday investors, says Finella Botes, Seeff’s agent for the areas.

Mouille Point now sells for R4.5 million to R40 million (R70 000 to R80 000 per square metre) and the Waterfront from R6 million to R18 million on average and R25 million to R65 million for top-end sea-facing units. Canal apartments are achieving R80 000 to R100 000 per square metre and R110 000 to R120 000 per square metre on the Front Yacht Basin. Apartments in the Silo’s range sell for R8.5 million to R26.5 million (R80 000 to R105 000 per square metre).

6. Clifton - beach apartments from R8 million

This four bedroom, four-and-a-half bathroom apartment in Clifton, Cape Town, has generous open-plan living areas with a private terrace and rim-flow pool overlooking the Clifton beaches plus a glass-walled cinema room. It is selling for R65 million - click here to view.

Lance Cohen, Seeff’s luxury market specialist for the Atlantic Seaboard, says although the market is quiet, apartments in Clifton remain highly sought after for holiday investments, attracting wealthy buyers from across the world. On the mountainside, you can still buy for R50 000 to R120 000 per square metre, but expect to pay around R100 000 to R200 000 per square metre on the seaside of Victoria Road. Prices have remained flat for the last two years and it is a good time to invest here, he says. Current stock ranges from R20 million to R65 million.

What do you need to know when investing in holiday property?

As the continent’s top tourist city, Cape Town is in high demand for holiday accommodation and has a buoyant Airbnb and holiday rentals market, says Muller. You can therefore invest in your own holiday apartment and rent it out when not in use, but be warned, the market is somewhat overstocked right now.

Invest with great care and forethought, especially if you live in another province. Buy in a good spot close to amenities and entertainment, preferably with a sea views and easy beach access. Location is important to attract high-calibre holidaymakers and good rental returns, she says.

Bear in mind that holiday rental income streams are not steady but seasonal. Stock levels affect the demand and returns, and you should ensure you are able to absorb the costs if you are unable to fill your property. Holiday homes, especially on the coast, also attract higher maintenance costs.

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