Area Review: Property in Observatory, Cape Town

If Durbanville in the northern suburbs lies behind an imaginary boerewors curtain, then Observatory in Cape Town is chilling out behind an invisible couscous curtain (organic, of course). “Obs” – as the locals call it – derives its name from the Royal Observatory, which was built in 1820 and is now home to the headquarters of the South African Astronomical Observatory. This history may in some way explain why the people of Observatory are big on dream catchers and star gazing – and passionate about all things organic and holistic. (Obs proudly hosts the Holistic Lifestyle Fair on the first Sunday of every month at the Observatory Recreation Centre from 10am to 4pm, rain or shine. It’s a hit on the hippie circuit. Here you will find everything from organic produce and alternative remedies to handmade jewellery and esoteric reading material.) If you’re getting a Bohemian vibe, that’s the idea – for Observatory is eccentric and more than a tad New Age, which should come as no surprise. Given its location (sandwiched between Main Road and Liesbeeck Parkway) and close proximity to the University of Cape Town, the suburb is a student magnet. And students make for a vibrant (read highly vocal) and creative community. The multicultural character of Observatory is another attribute that has attracted a diverse and peace-loving people group to the suburb. Bart and Leasha Love owned a property in Kenilworth before they bought their three-bedroom home in Observatory in 2007. Bart says they chose to buy property in Observatory because of affordability, location and the vibe. “We really like that it’s a mixed community, and that the properties have potential business value. We like the mix of residential, business and all the restaurants and coffee shops and that you can walk around the area at night, whether it’s to go down to Pick n Pay or Spar or to Obz Cafe for a pizza and beers.” Bart says that although the couple may one day decide to live elsewhere, they would continue to operate their business, Another Love Productions, from Obs. Rose Eedes Properties has been doing business in Observatory for the past 20 years, and estate agent Craig Gilfillan has been selling property in Observatory for 10 years. Craig has also lived in Observatory for eight years and owned two properties there. He says accessibility, affordability and the vibrancy are what make Observatory hot property. “It has a lot to do with location. Obs is central: two to five minutes from the university; seven minutes from the city centre; and seven minutes from Century City. It’s accessible to the N1, the N2 and Main Road. No matter where you work in Cape Town, you’re within easy access. So it’s also great for young professionals. A lot of first-time buyers start out in Obs.” And the return on investment is generally great. The last house that Craig bought in Obs was a three-bedroom, two-bathroom home that he picked up for R360,000 in 2001. He sold it in 2005 for R1.4m. According to data supplied by Lightstone property analysts, property in Observatory has proved to be a good investment. The average price of a freehold property in Observatory in 2004 was R506k. Now you’d be hard pressed to find a sectional title property for that price in the trendy suburb. The average price of a freehold property in Observatory in now R975k, while the average price of a sectional title property is R680k. (Sectional title property in Observatory constitutes only 25% of all market stock – or 647 out of a total of about 2700 properties in the suburb.) Describing the stock in the market, Craig says 80% of properties in Observatory are old Victorian houses, about 15% are 1930s-style abodes and the rest are new. He rates the condition of most properties in Observatory as “average to above average” and says that those that are well priced sell quickly. The cheapest property that Rose Eedes has on the market in Observatory is one-bedroom apartment (they’re like hens’ teeth) for R475,000, and the most pricey property is a freestanding four-bedroom Victorian (with flatlet) for R2.3m. Craig says buyers don’t like spending more than R2m in Obs because of what’s available in surrounding suburbs. Prices in Observatory must remain relative to surrounding markets. For example, property in Rondebosch is more sought after and offers better value for money (larger properties, greener surrounds and better amenities). Before the slump in the market, property in Observatory sold like hot cakes, in a matter of weeks. Six months ago they were taking up to three months to sell. But the market is definitely “on the up”. In spite of the sluggish climate, about 75 properties in Observatory have changed hands this year, according to Deeds Office data. Craig says that over the past two months, estate agents in the area have had a good run. “There’s a lot more interest in the market now that the banks are giving 100% bonds again. With this being a first-time buyer area, most buyers don’t have a deposit.” Obs is also popular among investors seeking strong rental returns. And the demand for rental properties is always high. “We’re one of the larger agencies and at any given time we don’t have enough stock. It moves so quickly. I’d say 50% of tenants are students and the rest are young people starting out.” A two-bedroom home (without parking) can easily fetch a rental of R6000 a month. The scarcity of off-street parking in Observatory is a problem, though it depends on your stage of life, says Craig. If you’re a student driving a banged up old Beatle, you won’t mind parking on the street. And students living in Obs don’t need their own transport because it’s so easy to catch a train, bus, taxi or Jammie Shuttle. But if you drive a decent car, you would have cause for concern because of the criminal element in Observatory. Brian Amery is the chairman of the steering committee for the recently established Observatory Improvement District. (An improvement district is formed by agreement of businesses and/or residents in a particular area to “top up” the services provided by the council. The city charges a levy over and above the normal rates, payable by all ratepayers in the area. Among the extra services provided are security and cleaning.) He says there are 150 crime incidents every month in Observatory, excluding those that go unreported. These incidents are mostly house break-ins and theft of and out of cars. The OBSID only took occupation of its office last month, but once the security contract is in place, Observatory will have two cars patrolling the suburb 24/7, in addition to four people on bicycles and/or on foot. CCTV cameras are to come, along with two designated Metro cops. Brian says the OBSID has a big job ahead of it, but that the will and determination to clean up and reclaim the suburb is there. “We also have budget for a dedicated field worker to work with vagrants and homeless people – as well as budget to revive the parks and sort out infrastructure, like missing manhole covers etc.” Considering the community spirit for which Obs is renowned, the OBSID will get all the support it needs to win the fight against crime.