Cape Town Property: Why You Should Invest Now

Cape Town is well known for its spectacular views of mountains and sea. It is hard to find a property in this popular city that does not have a room with a view. Tourists flock here year-on-year to experience the fantastic weather, pristine beaches and the diverse cultures that Cape Town has to offer.

Cape Town recently added yet another prestigious accolade to its list of awards by being named the Best World City in the 2008 Telegraph Travel Awards. This confirmed its popularity among international holidaymakers and also highlighted the city’s investment potential.

The city’s most exclusive suburb, Bantry Bay, recently made news with a staggering property sale of R36,5 million ($4,37 million). This suburb is located on the Atlantic Seaboard, known for being at the top end of the market and often attracting cash buyers with a keen eye for a good investment.

Another reason for investing in Cape Town property is the fact that the property market here shows extreme stability. This has been proven in the recent economic downturn; rentals throughout South Africa are down, yet those in Cape Town seems to be booming.

The favourable exchange rate in South Africa also makes Cape Town property an attractive investment. Also, the fact that South Africa has such a strong economy means that you are guaranteed to yield excellent long-term returns on your investment.

The availability of property in Cape Town is also a factor for investors to consider. The city has seen a lot of development in the last 10 years. The shortage of available sites, especially in popular place like Camp’s Bay and Clifton seems to be drying up, resulting in a golden opportunity for investors.

The 2010 Soccer World Cup being held in South Africa is one of the biggest reasons to invest in Cape Town property. The city will be hosting a number of matches at a brand new stadium. Along with a massive infrastructure boost, experts are expecting Cape Town to be a more desirable destination for leisure and business travellers, investors, and of course, its residents after the tournament.

Cape Town property has long been some of the country’s most sought after, especially Atlantic Seaboard Property. - Elizabeth McLachlan

BER Predicts Three More Cuts

The information in this article is courtesy of iAfrica (BER sees 150bs cut – 22 May 2009).

The Bureau for Economic Research (BER) believes that more limited rate cuts of 50 basis points could be expected in South Africa. There is also a chance that the Reserve Bank might go a bit further than that.

Professor Ben Smit of BER said that the Governor acknowledges recession meaning we can expect “recessionary conditions”.

According to Smit some improvement can be expected towards the 3rd quarter of the year, and he pointed out that the global crisis has probably had about 4% impact on the BER’s GDP forecasts.

BER predicts inflation in South Africa at an average of 6.8% in 2009, dipping below 6% in August, but ending the year back at 6.9%. In 2010 these levels will move back to within target range averaging 5.3%.

In other predictions, the BER sees South Africa's nominal wage rate at an annual average of 8.3 percent in 2009 from 9.9 percent in 2008, dipping to 6.3 percent in 2010.

Selling Options: The Pros and Cons

The information in this article is courtesy of Realestateweb (Selling your property – 21 May 2009)

When it comes to selling property, you have a few options. Most people opt for using an estate agent, other sell by private tender and some go to auction to get their property off the market. Here are the pros and cons of these options:

Sale by private tender incorporates the best selling methods of estate agents and auctions. Your property will also have a limited time in which it will be sold. The process of selling by private tender is not transparent, which means that buyers are forced to put their best offer forward as they do not know who has offered what.

A disadvantage of selling by private tender is that buyers have a short time in which they have to make a decision, as there are limited viewing days. Also, sellers might not accept any of the offers and buyers never know what price they are bidding against, leaving them no choice but to put in their maximum bid.

Using an estate agent to sell your property means you get a personal service. Safety is also guaranteed as the agent will screen and pre-qualify potential buyers to view property. Also, you can benefit from estate agents’ knowledge of legal terms and the property market.

However, estate agents charges a commission and advertising and marketing your property might be expensive. Another disadvantage of using an estate agent to sell your property is that not all agents have the incentive to get the highest price for the property.

When you sell your property on auction, you are assured that the buyer will take care of the commission as well as all the other costs of the transaction. The deal is transparent since auctions are live and bidders know at every stage what the highest bid is. The purchase of a property on auctions is also not subject to bond approvals.

A disadvantage of selling on auction is that buyers are often scared of bidding, because they are not familiar with the process. Also, there is often an oversupply of stock meaning sellers can often miss out on an opportunity to sell. Another downside is that in some cases, sellers are responsible for advertising costs.

More Accolades for the Mother City

Cape Town has won another prestigious prize – this time palming in the award for Africa’s leading destination at the World Travel Award in Durban on May 11. The Property Magazine reports that this is the second time in a row that this popular city has walked away with the award.

Executive Director of Economic, Social Development and Tourism in the City of Cape Town, Mansoor Mohamed, who accepted the award, said that it reaffirms Cape Town’s position as leading tourism destination and will also help to make Cape Town the city of choice for the 2010 Fifa World Cup.

Travel experts have rated this award as the best endorsement that any travel product can receive and it is globally considered as the Oscars of the travel industry.

The Mount Nelson Hotel in Cape Town also scooped up the award for Africa’s Leading Hotel. Mariette du Tiot Helmbold, CEO of Cape Town Tourism, accepted the award.

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Atlantic Seaboard Property: It's Bargain Time

The information in this article is courtesy of Business Day (Bargain time on the Atlantic Seaboard – 6 April 2009)

Never has there been a better time to buy property in this sought after area. According to Di Reid, principal of the Atlantic Seaboard Chas Everitt International franchise, the prices for expensive properties on the Atlantic Seaboard has come done – presenting those wishing to buy into the area with a perfect opportunity to scoop up a bargain.

Property in Camps Bay are selling for between R4,5 and R10 million and Bakoven homes around R8,5 million. You can now pick up Clifton apartments for between R6,5 and R10 million – between 6% and 21 % lower than six months ago.

Reid added that there has also been a trend among investors to buy some of the older properties in these areas to renovate or to demolish to make room for contemporary sectional title properties. These properties can be rented out for between R15 000 and R25 000 per month.

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