Although one would perhaps be forgiven for believing that the property market is still going through a recovery phase, there are certain areas in South Africa that have shrugged off the effects of the recession and subsequent credit crunch. This is not surprising, as even in the worst affected countries such as the US and Great Britain, there were pockets which remained unscathed by the crisis. Property in these areas remained in high demand and as such, prices stayed on an even keel. The same can be said for a number of areas in South Africa and this is particularly evident in areas where there has traditionally been a strong demand for property.
The Berea in Durban, KwaZulu-Natal is a prime example. Although prices remained pretty static during the mid 2000s, overall there was not a drastic reduction in price. The number of sales may have dipped, but this doesn’t seem to have affected the price that sellers were able to attain.
According to statistics that have been sourced from Lightstone, there have been 91 transfers in the area in the last 12 months. The average price paid for a sectional title property was R2.468-million and the freehold average was R1.397-million.
The increase in the sectional title average when compared to the 2010 price average of R1.333-million is quite dramatic. There has also been a 20 percent increase in the number of sectional title properties sold since 2010, which is encouraging news. This could perhaps be due to the fact that demand for secure lifestyle complexes has risen in South Africa over the years as the number of sectional title complexes in the area only form 12.74 percent of market stock. It stands to reason that the high demand for this type of property and the limited stock available could be the driving force behind this marked increase.
The freehold sector of the market has unfortunately not enjoyed the same growth in terms of price average and number of sales. However, this sector has remained stable, with only a marginal decrease in terms of price average obtained.
In 2011 there was just over R125-million worth of property sold, which is on a par with the figure attained in 2010. The area enjoys a good mix of residents of all ages and 74 percent of those who recently bought property in the suburb were under the age of 49 years. The area is close to all the major business hubs as well as educational facilities and shopping centres. The convenience of this location encourages stable long-term ownership and this is reflected in the stats which indicate that 41 percent of owners have resided in the area for longer than 11 years.