There’s something afoot in Rustenburg – something that might just make it one of the more attractive destinations if you’re looking to invest in residential property right now.
The town is the centre of South Africa’s lucrative platinum mining industry. This country possesses more than 80% of the world’s reserves of the alluring, shimmering metal that’s so important to the global fleet. (It’s used in catalytic converters in the exhaust systems of our vehicles because of its ability to ‘pacify’ harmful gasses: carbon monoxide, for example, which it converts into carbon dioxide and water vapour.)
And, according to the Mining Intelligence Database– the “various and increasingly important uses for platinum” have created a situation where demand outstrips supply.
Metal mirrors market
Strangely enough (or not, depending on your point of view), this mirrors the state of the residential property market in Rustenburg itself.
Like the price of platinum, which has fluctuated between about $1,300 and $1,900 over the last five years, property prices in the region have gone up and down – but held steady overall.
Huizemark Rustenburg franchisee and PrivateProperty.co.za advertiser, Ryno Cilliers, launched his business in 2008 – just in time for the worldwide crunch.
“It wasn’t the best time to open a property business, and the market in Rustenburg did take a knock from the recession – especially as it came immediately after a two-year period of growth, when prices were doubling.
“But the town’s economy is built on the presence of the world’s largest platinum mines – so by mid-2009 the market had recovered to a point that could be described as normal under the circumstances.”
Beating the odds
Actually, compared to the rest of the country, Rustenburg was doing very well. Leaving aside the fact that Ryno’s business won Huizemark’s “Rising Star” award in its first year of operation, it also took the group’s “Franchise of the Year” award in 2009, 2010, and 2011 – and that award is based on Rand value of sales as well as on the number of units sold.
“But then the strikes hit us in 2012; we had the Marikana shootings in August; and just after that Anglo American Platinum announced that it was going to retrench 16 000 workers (although that didn’t happen).
“And now things weren’t going well. Property sales were falling through because of the strike – people were being forced to cancel their offers to purchase because they were being retrenched – and many prominent businesses took a financial knock.”
Market is always there
But in Rustenburg, he said, “The market is always there – it’s just the dynamic that changes.” And, true to form, it’s starting to turn again.
Ryno said that Huizemark Rustenburg has about 500 properties on its books – of which about half are listed with Private Property.
“There’s a gap in the market in the R900 000 to R1.5-million bracket – which is where most of the buyers are, although it’s also where we have the least amount of stock.” (An incentive for developers, perhaps? Especially since the company has a number of development opportunities on its books – including one R11-million property which has rights for 34 double-story units on a 1.1 hectare stand).
Ryno said that many of the people who are lining up to buy property are, “Young professionals with jobs in the mines.”
And it’s not hard to see why they’re there: Rustenburg has a lot to offer, said Ryno (who’s also a part-owner of Cashan Manor Guest Lodge, which mostly serves visitors who come to the town on mining business).
“We’ve got good schools and great sporting facilities, and we’re just 30 minutes from attractions like Sun City and the bushveld reserves like Madikwe and the Pilanesberg (which is South Africa’s fourth largest national park).
“You can make a life here.”