With activity continuing to rebound over the past year, East London’s housing market is experiencing an influx of families, young professionals and first-time buyers, says Sean Coetzee, area principal for Pam Golding Properties.
“Positively, with a median price of R1.34 million, freehold homes in East London offer good value and are accessibly priced for home seekers. For example, suburbs such as Cambridge and Amalinda, which were previously deemed ‘blue collar’ are enjoying an influx of buyers who are not only purchasing but making considerable improvements to properties, with sand, cement and building materials in evidence in locations such as these, where modest starter homes can be had for as little as R1.1 million”, Says Coetzee.
“The sweet spot for first time buyers is in the price range which is mainly between R800 000 and R1.5 million, while the market up to approximately R3 million is very active.
“Generally, there’s a high demand in East London for sectional title properties, mostly as a first step into the property market for new buyers, or for retirement-aged buyers looking to down-size and simplify.
“While the largest group (48%) of home buyers are in the age bracket from 36-49 years, young adults between 18 and 35 years comprise 28% of all recent buyers. The Eastern Cape doesn’t see the same influx of semigrators from Gauteng as areas such as George or Mossel Bay. Many of our home buyers are aspirational locals looking to climb the property ladder, just like any other city in South Africa.
“Notably, and according to Lightstone statistics, over the 12-months period from April 2021 to March 2022, 76% of buyers were under the age of 50 years,” emphasises Coetzee.
Also according to Lightstone, East London experienced a sharp increase in the number of plots sold in 2021, with a total of 245 plots sold, which is the highest number registered during the past decade.
Comments Coetzee: “We see many of our buyers purchasing now with a plan to build at a later stage on estates, especially on the East Coast, which has grown exponentially in popularity. For example, Balugha River Estate is 80% sold out and Khamanga Bay has seen a great deal of interest, especially with regards to vacant plot sales.”
Coetzee says there is a strong demand for decent, affordable accommodation for the city’s senior citizens. “This is definitely a sector which offers lucrative returns for savvy investors and developers with the right product at the correct price.”
Positive news for East London, with spin-offs for the local economy, including the residential property market, is Mercedes-Benz’ R3 billion investment in production of the new generation C-Class. In November last year, media reports stated that 16 companies in the automotive sector have invested a total of R3.3 billion in the East London Industrial Development Zone (IDZ), which is also expected to help boost the economy in the Eastern Cape, thereby creating in excess of 2 000 jobs, as well as further creating indirect jobs via the supply chain.
In addition, the re-opening in October 2021 of the 200k Cookhouse-Blaney railway line between East London and Gqeberha – including the Coega Industrial Development Zones, which reduces the travel time by almost half, is anticipated to support the province’s manufacturing sector, reducing the transport cost of goods and alleviating pressure on road infrastructure.