Sellers of coastal properties are realising better prices for their homes than inland homeowners.
Lightstone Property’s May newsletter showed that, as at end December 2021, house price inflation in coastal areas was 6.1 percent and in non-coastal areas was 4.9 percent.
The national average at the end of March was at 4.55 percent.
And while average house price inflation for sectional title and freehold properties has drifted downwards since mid-2021, Lightstone data showed the value of estate homes was steady, and in some areas increased significantly, as security becomes more important for home buyers.
RE/MAX of Southern Africa chief executive Adrian Goslett said the trend to favour a coastal lifestyle over urban areas has remained strong, even after the peak pandemic activity had subsided.
“The pandemic saw buyers spread further afield to find homes that offer a higher quality of lifestyle. This trend seems to be holding strong for as long as the option to work remotely continues to exist,” he said.
Barbara Larney of RE/MAX Town and Country said the “buying panic of fleeing to the countryside” during the pandemic was over in Hermanus, Franschhoek and Paarl.
“That being said, I doubt things will go back to how they were before. Young families have been taking advantage of this lifestyle shift by abandoning locations they were tied to only because of their jobs,” she said.
“Smaller towns are likely to grow faster in some instances to accommodate this demand,” she added.
Betterbond chief executive Carl Coetzee said the “pandemic has not only changed the way we work and socialise, it has also changed the way we live. Quality of life has become important… there’s been a surge of interest in lifestyle estates that make it possible to enjoy recreational activities in a controlled environment.
“It’s not surprising that the value of homes sold in estates is higher than other property types, and rising rapidly to accommodate this demand,” he said.
Larney said the main reason for buyers moving to coastal and country areas was semigration.
“The most activity is seen at the coast, Gansbaai and surrounding areas, especially between the R2.5 to R5 million price range. Remote working and people wanting space, security and an outdoor lifestyle is a major trend,” she said.
She said the pandemic had accelerated the trend of digital nomads – individuals who travel from place to place with no fixed permanent home and who tend to rent their next temporary home from abroad, sight unseen.
However, there were increasing concerns around affordability.
“We are seeing increasing inventory in certain segments. With rising interest rates, inflation, and geopolitical turmoil, buyers are more likely to evaluate their next move. The scale still favours the seller for now, but we are starting to see a shift,” she said.
Homes off the grid were becoming increasingly popular.
Another trend was to remodel and upcycle older homes to lower costs and to reduce wastefulness. Tiny houses were also becoming increasingly popular.
“It is no longer about commutability. It’s about quality of life and going green and being self-sustainable. For this reason, I predict the demand for coastal and country homes will remain strong for the foreseeable future,” Larney said.
Along the sought-after Atlantic Seaboard, homes in secure estates were now selling at prices last seen in 2018 before the property bubble burst. Two years ago, the average sales price of homes in this market was R8.2m. The same property was now valued at an average R12m.
edward.west@inl.co.za
BUSINESS REPORT