Northgate is seemingly bucking national property market trends as demand for property in the area remains strong. That’s the news from Greg Wilson of Chas Everitt which services the area.
The latest Lightstone report on the area backs up Wilson’s comments. To date, 88 sales have occurred in the area in 2011. This isn’t far off the area’s 2010 figures of 92 sales. What is more, Northgate has maintained a fairly similar sales ratio since 2005. Wilson says Northgate’s popularity can be attributed in large part to the fact that the majority of the suburb comprises affordable Sectional Title properties. According to Lightstone statistics, just over 97 percent in point of fact.
Wilson says the land that many of Northgate’s properties currently occupy originally formed part of a large farm. Around 15 to 20 years ago, the land was put up for sale which was quickly snapped up by developers who identified the area as a growth zone.
Units in the area typically measure approximately 65sqm’s, feature one or two bedrooms, a small garden, open plan kitchen and car port. These units are usually put on the market at between R400 000 and R600 000 with the most expensive units selling for R1, 2m. Lightstone statistics place the current average sales price at R566 000 which is up from 2010’s average of R544 000.
And bargains aplenty are currently to be had says Wilson. “During the years preceding the fallout of 2008, a number of investors overextended themselves by purchasing buy-to-let properties in the area. In the years since the fallout, these investors have found that they can no longer afford said properties and have put them on the market at cost in a bid to sell them quickly.”
Wilson cites Northgate’s locality as another reason why it has remained so popular over the years. “Northgate is centrally located and residents can reach their places of work in Randburg, Sandton, Lonehill, Lanseria and Kya Sands with ease. Indeed, many people move to the area primarily because of this reason.”
The profile of those who buy in the area attests to this. According to Lightstone, approximately 60 percent of new buyers to the suburb fall into the ‘youth/ adult’ bracket of 18 to 35, many of whom are just starting out on the corporate ladder. And those who can’t afford to buy, rent in the area instead says Wilson. “The banks have become tight-fisted again which isn’t surprising given prevailing economic circumstances.
“At present, only 50 percent of bonds are being granted and many entry level buyers are being turned away because they don’t have a credit history, are blacklisted or don’t have enough money for the large deposits banks now require. Consequently, they have no choice but to rent which has boosted Northgate’s rental market significantly. Indeed, many of Northgate’s rental units are snapped up within the first day of being put on the market. Currently units are leasing for between R3, 800 and R6000pm.”
The fact that Northgate is surrounded by retail outlets further bolsters its appeal explains Wilson. Northgate Shopping Centre, Banbury Cross and Bellairs are within walking distance of many of the developments. A number of schools including Sharonlea Primary School and Saint Mark’s Anglican also lie within easy reach.
Appealing views also come part and parcel with living in Northgate adds Wilson. “Much of Northgate is spread over a hilly area which affords those who live there sweeping views of Sandton and Randburg.”
As for the two percent of freehold properties in Northgate (which apparently equates to a grand total of 25 houses) three were sold in 2010 at an average price of R3, 2m. No freehold sales have taken place in 2011.