DESPITE recent fires destroying more than 70 homes in St Francis Bay, the property market in this popular coastal holiday resort is booming.
Local Pam Golding Properties principal Richard Arderne said the summer season had seen the best property sales in years, with more than R120-million in sales concluded by all agencies across the market.
This was an increase of about 20% compared to the same time last year. Arderne said he last saw a boom like this around 2008.
“Since November at least nine homes have each sold for over R4-million and at least a further nine for more than R2.5-million. This tempo of high sales value has not been seen for several years.
“In addition, all four houses in Sunset Avenue, which had been on the market for about two years, sold in recent weeks, all for over R5-million each. At least seven canal homes sold – two of which fetched over R10-million each.”
Arderne said these homes were bought by South Africans, mostly Eastern Cape residents.
“Most of the houses are holiday homes. About 80% of the houses on the canals are holiday homes. Both the homes that sold for over R10-million were bought by Eastern Cape buyers.”
Chas Everitt local principal John Cooper, who has been in the property industry for about 30 years, said the reason there was an upswing was because of low interest rates, a more positive sentiment about the property market as well as the hype around Thyspunt developments.
“Last year there was a lot of uncertainty, including the Marikana incident, which affected investor confidence, but I believe that we have put all of that behind us.”
He said he too had experienced the best market activity ever over the past three months.
Enid Pretorius Properties owner Enid Pretorius said the coastal town’s property market moved at its own pace and was not affected by downward or upward trends. “Buyers see these homes as good investments.”
She said the most popular segment in the market was between R2.5-million and R3-million, but that there recently had been sales in the high end of the market, with two houses going for R17-million and R14-million.
Arderne said it was positive to see that 80% of the 76 homes affected by the recent devastating fire had been demolished, with the first few houses under construction.
“We believe most insurance claims have been settled, with many new houses currently being designed or at plan-approval stage. It will be interesting to see the modern designs coming out of the ground, especially as many of the destroyed houses were more than 20 years old.”
He said two canal plots affected by the fire had been sold, one located on the ski canal which fetched more than R3.5-million, with quite a few more now on the market but at relatively high prices.
Two recent house sales were by owners affected by the fire who wanted to improve on their positions by relocating in the area, while another sale was to a canal owner upgrading his view.
Arderne said: “The buyers are mainly South Africans, some of whom are relocating from other areas to St Francis.
“Although there were a number of sales of houses in the R1-million to R2-million price range, the bulk of the sales this summer were at higher prices, which is bucking the trend of the past few years and a positive indicator for residential property values moving forward.
“The reason why sales have picked up may perhaps be attributed to one or more of the following – the excellent weather this summer, the expectations of a building boom as fire insurance money flows into the town, the high SA stock exchange, sellers accepting slightly lower offers, and buyers who perceive that prices are unlikely to drop further.
“The bottom line is the performance of St Francis Bay property this summer season has been too good to merely be a coincidence,” Arderne said.