While the number of international buyers in residential property in South Africa remains relatively low, at somewhere in the region of three percent nationally, investors from elsewhere on the continent – including returning expats - retain their appetite for the acquisition of South African real estate for a variety of reasons.
These include countries such as Zimbabwe, Zambia, Namibia, Nigeria, Botswana, Kenya, Angola, Moçambique, Angola, DRC, Ghana and Gabon, among others. The price range mostly in demand is from around R800 000 to approximately R5 million, with some enquiries and transactions up to R10 million and beyond.
Many are business executives, including entrepreneurs, either travelling regularly to South Africa on business or establishing bases from which to expand their operations, not only in South Africa but also in other African countries. As they may spend considerable time in the country it makes economic sense to purchase a home here, a trend which is particularly evident in Gauteng in areas such as Fourways, Sandton, Sandhurst, Hyde Park and Houghton, says Dr Andrew Golding, chief executive of the Pam Golding Property group.
“Others with children attending schools and universities here look to buy a home where they can reside when visiting during vacation periods or purchase a well-positioned apartment as student accommodation for their adult children, coupling as a sound investment. Some investors look to own a getaway holiday home in a highly desirable location, such as Cape Town’s Atlantic Seaboard, Southern Suburbs and the Blouberg area; the Cape’s Boland and Overberg regions, namely Stellenbosch and Somerset West or Hermanus, Kleinmond and Onrus; or the scenic Garden Route, for use by their immediate family for short or extended time frames during the year.”
With sound long term investment an important factor, as well as convenience and centrality of location, brand new, secure residential developments and gated lifestyle estates in areas such as Johannesburg – notably Dainfern Estate in Fourways and nearby Blair Atholl, or suburbs like Illovo, Inanda and Kelvin which are in convenient proximity to Sandton CBD and business hub and OR Tambo International Airport - and Pretoria, fit the bill.
“We see a large number of buyers from Africa investing in our new developments,” says Retha Schutte, Pam Golding Properties regional executive in Pretoria. “As they tend to spend a number of days a month here to conduct their business, they look mainly at furnished apartments that are available for the short term rental market. This gives them the opportunity to stay in the apartment for a few days a month and then put the apartment back in the rental pool.
“A recently launched new development, the Regency in Menlyn Maine, is a very good example, being a sectional title apartment building with the added benefit of a concierge desk, pool deck and state of the art restaurant, giving it the advantages, look and feel of a hotel. This development is well situated, with shopping and entertainment and a casino at hand, as well as a shuttle service to the nearest Gautrain station. Generally we find these buyers acquire properties in the price range between R1 million and R3 million,” adds Schutte. “Over and above this investment, they also contribute directly to the local economy as they grow their businesses in the country.”
In Fourways, a soon-to-be launched new development, Dainfern Square Luxury Apartments, will have high appeal for local buyers as well as from the rest of the continent. Says Kyle Ebben, area manager for Pam Golding Properties Fourways office: “At the leading edge of Johannesburg’s ongoing expansion into the ‘new North’, this is set to become one of the most desirable addresses in the city. It’s ideally located close to major transport points like William Nicol Drive, Lanseria Airport and the Gautrain bus service, right next door to Dainfern Square shopping centre and with an array of amenities in the vicinity, including medical facilities, eateries and a Virgin Active Health Club”.
Priced from R1.75 million to R3.85 million, the two-bedroom apartments offer convenient and secure, hassle-free living, ideal for investment, permanent residence or partial use when in South Africa. Other buyers, particularly those from Zimbabwe, not only look to buy residential property in Gauteng and the Western Cape, they also seek coastal holiday and retirement homes in KwaZulu-Natal - with its temperate year-round climate, or lock-up-and-go homes in areas where their children attend private schools or university, such as Grahamstown in the Eastern Cape.
In KZN Carol Reynolds, Pam Golding Properties area principal for Durban Coastal, says new developments like Signature Sibaya on the North Coast have piqued the interest of buyers from Nigeria. “Most are interested in secure estates near the coast. They travel in Africa and want a base here in KZN – a holiday home to double up as a base for business meetings. They look at the upper end of the market and security is paramount.”
Moçambiquan buyers on the other hand are drawn to acquire property in towns such as Nelspruit, Komatipoort and Malelane, mainly as a result of cross-border trade between the two countries or due to expats from Moçambique who reside in South Africa where their children attend schools, and who commute to places of work over the border. Kunaal Samani, Pam Golding Properties MD in Kenya says: “For Kenyans, many of whom have children in educational institutions in South Africa, most attractive locations are Cape Town and Johannesburg for investment and diversification of their real estate portfolios – Cape Town mainly for leisure and second homes, and a retirement plan, and Johannesburg for rental income generation.”