Plettenberg Bay has become one of the most popular coastal property hotspots in the country.
It now ranks as the premier coastal residential belt outside of the Atlantic Seaboard for upper end and investment buyers.
With plenty of coast and sunshine, no traffic and easy access to the Garden Route towns including the commercial centre, George, buyers from all over the country have been packing for Plett. The town has seen a fair amount of influx over the last few years as semigrating families looked to settle in a more wholesome environment according to Kevin Engelsman, Licensee for Seeff Plettenberg Bay.
After a 5-year period of excellent growth between 2013-2017/8, the market has settled back, closely following the trajectory of the national housing market decline over the last two years. Bear in mind, he says, that the Plettenberg Bay housing market comprises not just of a residential sector but also a sizable second home market which is usually the first to feel the effects of an economic downturn.
While operating under slightly more muted conditions, the market nonetheless remains active, but largely below the R5 million price band. Sales above this is confined predominantly to the exclusive estates and the Sea Side Longships area, says Mr Engelsman.
Lightstone data shows that the total transaction volumes for Plettenberg Bay escalated from 383 in 2013 by about 40% annually to around 748 transactions in 2017. The 2016-2017 years were characterised by high volumes, in part due to new developments. The market decline set in from late 2017 and by 2018, the market had settled back to 494 transactions.
For the current year, a total of 290 transactions have been recorded for the January-August period and when extrapolated to 12 months and compared to the highs of 2016-2017, translates to the market being down by about 30%.
The average transaction price measured over the 12-month period between September 2018 and August 2019, stands at around R1,952 million. Full title sales account for 32% and an average selling price of R2,638 million. Estate property account for 19% at an average price of R2,904 million and sectional title property for 9% at an average price of R1,123 million. Vacant land accounts for 29% of all transactions.
The R1,5m-R3m price band has been the most robust, accounting for 50% of all transactions while only 28% of all transactions fall above R3m. As with the high-end areas, Plettenberg Bay has experienced a slow-down in sales above R5 million with only 12 transactions recorded for 2019 (to end of August), almost all below R10 million, save for a single high-value sale of R24m in Beachy Head Drive.
Plettenberg Bay enjoyed excellent interest in high value property during the 2013-2018 growth phase when several transactions were concluded above R20 million, especially in Beachy Head Drive and the rest of Sea Side Longships as well as in Whale Rock Ridge, Robberg Beach End and Whale Rock Beach estates.
In Beachy Head some 9 sales have been concluded above R20m ranging from R24m (2019) to R33m (2015) and R36 (2017). Robberg Beach End sales ranged to R35m (2018), R35,8m (2015) and R36m (2017) while a single high-end property sold in Whale Rock Beach Estate for R32m (2016).
The broader property market data continues to tell the story of muted price growth of around 3.5% by mid-year and inflation, while improved, still at around 4%. The average time that it takes to sell a property is still at around 14 weeks, somewhat below the market average of around 12 weeks. Depending on the price point, it could take considerably longer to sell.
The take-out from all of this, is that the market remains active, but with fewer buyers, asking prices, especially at the higher price points remain under pressure. Heading out of winter, Mr Engelsman says that agents are looking for a pickup in market activity over the summer months.
Plettenberg Bay is a popular holiday resort town and also renowned for the annual Plett Rage when matriculants from across the country descend on the town to celebrate the end of their exams and school career. While a year-round destination, visitor numbers to the town swells over the school holidays and the summer in particular with literally thousands flock here.
Plettenberg Bay offers a fabulous climate and lifestyle, something that holiday buyers and retirees have known for some time, says Mr Engelsman. The town offers excellent amenities, from restaurants and hotels to convenience and shopping centres, upmarket boutiques and décor shops, excellent schools, polo and the local Plett Wine and Bubbly Route, all set on the shores of some of the country’s best beaches.
The upside of this somewhat down market is that there is a superb selection of stock available with many prime properties now on offer. Conditions remain good for buyers as the banks are keen to lend and the interest rate is slightly down. Seeff currently has over 400 property listings to suit a variety of buyers and budgets, from compact apartments to farms and luxury estate, riverfront and beach houses.