It is now a buyers' market in the Western Cape
Category Market News
In 2015/2016, the Western Cape’s property market reached its pinnacle as demand for homes soared and properties were being snapped up for as high as R14.4mil in upmarket locations such as the Atlantic Seaboard. Driven mainly by semigration buyers, the province’s popularity saw it outperform both the Gauteng and KwaZulu-Natal’s markets by more than 5%.
These factors have led to the province retaining a sellers' market since 2015, however, recent trends reveal that the market is taking a downward turn as it gradually transitions to a buyers' market. This shift can be attributed to the fallout from a volatile political and economic climate, slow economic growth and credit downgrades.
What is a buyers' market?
A buyers' market takes place when supply exceeds demand, which provides buyers with the flexibility to negotiate down to their preferred price. This places sellers at a disadvantage as they are often left to accept lower than desired selling prices due to a low demand.
So what does this mean for sellers in the Western Cape?
Following the years of unparalleled price growth, the Western Cape’s property market is now cooling down and sellers need to lower their expectations. They will need to reduce their selling prices or prepare for the possibility of their homes remaining on the market for a long time or even staying vacant.
Current conditions indicate that the real estate landscape is saturated with overpriced homes that are sitting on the market for several months. Due to this, it is imperative for sellers to price their home right, in line with the market trends. This can be achieved by researching the optimum selling price in terms of its exact location, size and maintenance considerations. In fact, a property stands a better chance of selling within the first six weeks of its listing, making it even more imperative to correctly price your home.
To help sellers through this process, utilising the expertise of an experienced real estate agent is highly recommended as they will undertake a property valuation to determine the correct and most competitive selling price.
On the other hand, buyers, after a long time, now have more power to dictate the prices they will pay for a home, making it the ideal time for them to enter the Western Cape’s property market.
Although the province is transitioning into a buyers market, history has shown that the SA property market is a consistently wise investment, regardless of changes. And this is because buyers will always need the security that comes with having a place to call home and sellers will always place their homes on the market when their lifestyle requires, regardless of different cycles.
Most popular price bracket among buyers
The lower-mid income home buyers are currently the most active market and they are attracted to homes within or below the R2mil price bracket. Dormehl Phalane Property Group has secured a range of listings from the Western Cape within this affordable price bracket that are secure and modern. An example includes a two bedroom apartment in Parklands North, Blouberg, known as Nouveau Estate. This is a new development that is complete with high-end finishes such as pool and entertainment areas, and luscious private gardens and open spaces. The estate is pet-friendly with easy access to the BRT public transport system, medical centres, malls and fitness centres. Security on the estate includes electrified fencing and access control entry points.
As the market slants in favour of buyers, it is an opportune time to enter the Western Cape’s property market. To find out more about the homes here, speak to our helpful agents today.
Author: Dormehl Phalane Property Group