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KZN Property Market Outperforms – MyPR.co.za

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KZN Property Market Outperforms:

South Africa, March 2020 – According to Lightstone Property’s most recent Property Indices (March 2020) coastal property inflation is outperforming non-coastal properties, with Ethekwini municipality’s house prices being the second most buoyant of those tracked. The increase of 3.3% is higher than Lightstone’s forecast last year when the property data analysts noted that median prices of freehold and sectional title properties in KwaZulu-Natal had strengthened.

Chris Schoombee of Just Property Zululand says it’s not only the Durban Metro properties that are outperforming most of the country. The company has seen major demand for properties in Zululand that are priced from R400 000 to R1 500 000: “This includes the rural suburbs. We are marketing and selling a lot of properties in the middle-income township of eSikhawini in the King Cetshwayo District Municipality.”

This is not surprising considering that 76% of existing owners and 58% of recent sellers in eSikhawini H, close to Richards Bay and Empangeni, have owned their properties for 11 years or more.

“Such an extended period spans multiple stages of life; it also exceeds the minimum (eight years) that one must own an RDP house before being able to sell it so this is when we would expect to see changes in ownership,” explains Just Property Zululand franchisee Yolanda Cornelius. The median price of property in eSikhawini H is currently R650 000 versus R500 000 in 2019, considerably beating national property inflation trends.

Schoombee adds that he’s noticed a trend where more and more people are moving into sectional title units in Richards Bay and the surrounding areas. This is because sectional titles units are cheaper and seen to be safer. This insight is supported by market data which shows that, in the last 12 months, 400 sectional scheme and estate units sold versus 323 freehold properties in Richards Bay (accurate as at 17 March 2020).

Initiatives like Durban’s inner-city renewal projects, the KZN Automotive Supplier Park in Illovo (which includes the construction of thousands of new, affordable homes is estimated to create 25 000 new jobs ), the Kingsburgh Industrial Park (a commercial industrial estate developed to provide facilities for SME’s and start-ups) and the construction of the R1.3 billion vegetable oil refining facility for Wilmar Processing at the Richards Bay Industrial Development Zone (RBIDZ)  are expected to change the economic landscape of the region increase technology skills transfer and create employment opportunities right down the value chain.

“The region is poised for exceptional economic development going forward,” says Cornelius. “And we expect the KZN property market to consolidate the strides already made and further strengthen significantly.”

Closer to inner-city Durban, there is economic pressure on many residents at this time, which has negatively impacted the sales market. The positive aspect of this for investment buyers is a higher demand for rentals, bolstered by the rising need for student accommodation.

Gayle Gratwicke, of Just Property Berea, notes that their experience is that residential rentals in Durban are performing better than sales. “Driving factors for the Berea are proximity to good schools, such as Durban High School, Durban Girls College, DPHS, Maris Stella and Clifton, and to a lesser degree proximity to where people work. The Berea is made up of the suburbs Glenwood, Musgrave, Essenwood and Morningside, where we have top shopping centres such as Musgrave Mall, Davenport and the Atrium. Rentals on the Berea range from R4 000 to R20 000 per month, with the highest demand being in the R4 000 to R8 000 band.”

The redevelopment of Durban’s most important tourism attraction, the Point Waterfront, has attracted the interest of buy-to-let owners. While middle and south Point waterfronts achieve rental income from R7 000 upwards, rentals aimed at the higher income bracket (between R18 000 and R24 000 a month) can remain vacant for a period of time.

“Commercial rentals in Berea are substantial, and demand is climbing. Combining commercial with residential units in this area can create a profitable portfolio,” Gratwicke adds. “It is worth keeping an eye on the redevelopment of Rivertown and the Centrum Site (Durban’s old drive-in), which form part of the eThekwini’s municipality’s Inner-City Regeneration Plan.”

For more information on Just Property please visit www.just.property or call (087) 550 2258.

Video: KZN PROPERTY MARKET OUTPERFORMS

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