An overview of the Barkly West property market

Private Property South Africa
Private Property Reporter

Birthed from South Africa’s first major diamond rush in the late-1800s, Barkly West retains its quiet, peaceful setting and easy access to Kimberley, the province’s capital. Like a typical small town, its historic business centre dissolves into a residential neighbourhood and farm lands as you go further out.

Barkly West is set on the banks of the Vaal River and neighbours the Good Hope Nature Reserve in a nature reserve, making it an ideal choice for those who love the outdoors. In terms of property, Barkly West’s natural attractions make it a gold mine for Kimberley buyers contemplating a weekend vacation home or looking to get into the accommodation business.

Ownership structure

Age is a key aspect in terms of homeownership in Barkly West, particularly because of the importance of first-time home buyers, who are usually in their twenties and mid-thirties. Recent figures by Lightstone Properties for February 2018 to January 2019 show that middle-aged adults (36 - 49 years) made up the bulk of recent buyers, with 50% of all buyers falling within this age bracket. Middle aged adults (36%) were also the most active sellers, followed by pensioners (32%), maturing adults (23%) and young adults (9%). At 31%, young adults (18-35) were the second-biggest property buyers in Barkly West.

Also produced from the Lightstone report is a homeownership tenure for Barkly West, which showed that 65% of current homeowners have lived in the same property for more than 11 years while 26% of existing owners have been staying put for less than five years. Among recent sellers, 56% moved home after living in the property for more than 11 years, while 27% had a median duration of less than five years. Considering that 13% stayed in their homes for five to seven years, and 3% for eight to ten years, the average tenure of a home seller in Barkly West was relatively long.

Number of properties sold

As expected from a small town, Barkly West had a very low volume of homes on the market over the last twelve months. Between February 2018 and January 2019, 19 freehold properties were sold at a total value of R 7 446 000. Vacant land, of which 26 plots were sold for the period, generated total sales of R 9 955 000.

Home price growth

View homes for sale in Barkly West

Buying a property in Barkly West is slightly more expensive than was ten years ago with house hunters now having to fork out R499 000 on average in 2019 versus R382 000 in 2008 if they want to own a piece of the beautiful Northern Cape countryside. Between 2008 and 2019, the average selling price for the Barkly West market has been climbing steadily for the most part of the decade, peaking at R750 000 in 2017, and dipping to R235 000 in 2018. Still, compared to the national median house price, investing in property in Barkly West is relatively affordable.

Number of registrations

Barkly West’s housing inventory is not very diverse. There is virtually no demand and supply of sectional title and estate properties as all registrations over the last decade were done for freehold properties and vacant land. In 2018, there were 18 freehold properties registered, five registrations more than the previous year but eight fewer than 2015 when the number of registrations was at its highest.

Repossessions

The number of sales in execution remained significantly low between 2013 and 2017, compared to 2008 at the height of the financial crisis. In 2008, eight sales in execution were reported, followed by six the next year. Since 2013, only one home was sold at public auction every year. Thanks to Barkly West’s limited market inventory, which has helped to reserve home purchases to the most highly qualified and low-risk borrowers, homeowners have managed to avoid repossession.

Barkly West may exist in the shadow of its urban neighbour Kimberley, but there are a number of benefits property investors may not find in the city, not the least of which is lower barriers to entry, less competition, and flexible zoning regulations.

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