By Suren Naidoo
The KwaZulu-Natal property market and in particular North Durban, has taken centre stage as a more appealing and affordable alternative to alluring Cape Town, which is dealing with a severe drought.
That’s the view of Pam Golding Properties’ area principal for Durban Coastal, Carol Reynolds, who reports that the group’s North Durban office experienced record sales in January 2018 – outperforming the company’s Atlantic Seaboard office for the first time in history.
“South Africa seems to be buoyed by renewed confidence across all sectors of the financial and property markets. The indicators are positive that 2018 is poised for better growth than 2017, which experienced a short-lived recession. Indeed, for the first time in years, South Africa is filled with hope and possibility… And, KwaZulu-Natal in particular is ripe with possibility,” she said.
“It is interesting to note that the property price inflation that Cape Town has experienced over the past four years has to a large extent been driven by Johannesburg semigration, rather than by international investors. Given that our local investors have the capacity to drive demand to such an extent, we anticipate a similar influx of families to the North Durban coastline in the coming years. Most notably, Johannesburg commuters are seeking the lifestyle offering in KZN, which, in my opinion, simply cannot be beaten,” added Reynolds.
She said that with the January 2018 record performance of Pam Golding’s North Durban office, the group felt that this is “a small microcosm of things to come” for KZN.
Reynolds explained: “Several factors have converged at just the right time, to launch KZN into the limelight. For example: Oceans in Umhlanga won international acclaim for its architectural design, and this has opened up the global arena for KZN as a property player. In addition, the far-reaching impact that the latest hotspot, Sibaya, as a precinct, with its high desirability and accessibility, has had on local and foreign investors has given KZN a platform to display its virtues.”
She added: “Durban has won best lifestyle city in South Africa (Mercer’s Quality of Living survey) for the past three consecutive years, so it is not surprising that the KZN coastline has piqued the interest of the most discerning investors.
“As a result, we foresee a more buoyant 2018, particularly in the North Coast corridor of KZN stretching from Durban North through to Ballito. However, there continues to be an air of caution that pervades the markets in general, and hence price inflation may be gradual, particularly at the upper end, as buyers and sellers both find themselves in a more rational negotiating space. We predict it to be a year of fair trading – fair results on both sides of the spectrum, with the lower end of the market experiencing more growth than the upper end.”
Reynolds said: “Against this interesting backdrop of optimism, buffered by the reality of financial conservatism, there are a few trends that we expect to gain momentum this year. The first is the emergence of a stronger middle-class of buyers from a more representative demographic and the second is the widening of the first time buyer pool. We are hopeful that more entry-level stock will be offered into the market, as developers deliver products that meet the needs of the price band that sits below the R1 million bracket.
“We have been in discussions with several developers who are researching the viability of sectional title complexes with smaller, trendier units at lower ticket prices to cater for the young professional market. This will drive activity levels and be an enabler for those who have found traditional market prices unattainable.”
According to Reynolds, security estates will continue to be popular and the move to smaller lock-up-and-go lifestyle options will keep trending. “The densification of established residential suburbs may also gain traction, as developers seek to consolidate and redevelop in areas where there is a need for small boutique estates. We may also start to see modernisation of existing complexes, where there is a shortage of land for further development.”
She said: “With Cape Town’s development activity under duress due to its water restrictions, we anticipate developers turning to KZN for opportunities. So while we were previously concerned about the over-supply of developments in the North Coast area, and the political instability that wreaked havoc with the markets last year, we now anticipate that given the more favourable political climate, demand will meet supply and there will be a healthy mix of new stock and new buyers entering the market simultaneously.”
Reynolds concludes: “The KZN North Coast is benefiting from a bouquet of factors that have come together in perfect synchronicity, to herald it as the country’s number one growth node.”
* Content Edited by Suren Naidoo.