This is according to Lanice Steward, managing director of Knight Frank Residential SA, who says when looking at PropStats there is an indication that prices are being pushed upwards in some areas with shorter periods to sell, particularly on the Atlantic Seaboard in Cape Town.
There is an indication that prices are being pushed upwards in some areas with shorter periods to sell, particularly on the Atlantic Seaboard. In 2013, figures of sales from January to September show that 650 units were sold at an average price of R4 826 936. These properties took an average 125 days to sell and there was a 13.5 percent price difference between the asking price and selling price to achieve the sales. This year, during the same period, PropStats indicates that 557 properties were sold. The average selling price is listed as R5 899 310, with a 9.3 percent difference between the asking and selling price, while properties are taking on average 111 days to sell. “What should be borne in mind, however, is that not all the sales for September would have been captured as yet and there may be more coming in. What is interesting to see though, is that, while there is a reduction in volume, there is a definite increase in the average selling price and a reduction in the time it takes to sell a home,” says Steward. The 22 percent increase in the average selling price from last year to this year is being driven by demand for units in this area, and with the stock constraints, it should continue, she says.
Steward says John Loos’ 3rd Quarter FNB Estate Agent Home Buying Survey indicates that homes nationally are taking, on average, 81 days to sell. “We can deduce by comparing the national figures to that of PropStats that homes at the upper end of the market are taking longer to sell than at the lower end.”
In 2014 to date, there were 84 homes listed on PropStats that sold for over R10 million on the Atlantic Seaboard, and these took an average of 262 days to sell. In the R5 million and below price bracket (375 homes), however, properties took an average of 60 days to sell. According to Loos, the national drop in asking price to selling price is 8 percent, but on the Atlantic Seaboard, at the lower end of the market, it is 5.8 percent, and at the higher end 11.2 percent.
“All agents in all areas are experiencing stock shortages in the rental and sales market. Given that we are going into the summer season, which is traditionally when most people tend to buy and sell, we can expect increasing pressure on the market, pushing prices upwards even further,” says Steward.