High-end properties bought for cash
High-end property in the Western Cape is being bought for cash, with these sales accounting for up to 90 percent of transactions in the past year or so, say experts.
Ian Slot, Seeff 's managing director for the Atlantic Seaboard, CBD and City Bowl, said the firm had seen notable growth in cash buyers, Cape Town over the past three years.
'In the last year alone, cash buyers increased by over 10 percent in some areas and price bands, as buyer confidence in property as a preferred investment grows.
'Of the total of 3 785 sales transactions across the Atlantic Seaboard and City Bowl over the past three years, almost 60 percent (about 2 217 sales) - or two out of every three transactions - were cash deals.'
Slot said that for the year to March, about 68 percent of the 768 sales on the Atlantic Seaboard and 53 percent of 691 sales across the CBD and City Bowl were cash transactions.
'This has resulted in a total direct cash inflow into the property market here of over R4.2 billion.'
Seeff 's Lance Cohen said almost 43 percent of all sales over the past year below the R5 million mark had been cash transactions. About 90 percent of homes priced above R10m had been sold in cash transactions.
'When it comes to the luxury suburbs cash reigns, with anything upwards of 77 percent of all buyers in Camps Bay to over 90 percent (29 out of 32) of Clifton buyers transacting in cash.'
Cohen added that most of the 22 odd trophy homes priced above the R20m mark that sold in Clifton, Bantry Bay, Fresnaye and Camps Bay had been to cash buyers.
Seeff chairman Samuel Seeff said there was a mix of local and foreign cash buyers, as well as expats who invest their money here.
Mike Greeff, the chief executive of Greeff Properties, the Western Cape's exclusive affiliate of Christie's International Real Estate, said demand for property in the City Bowl was fuelled by an increasingly efficient public transport system.
The firm's agents reported that foreign interest in City Bowl properties was at a record high.
Laurie Wener, managing director for Pam Golding Properties Western Cape, said the Atlantic Seaboard and City Bowl had seen a rush on sectional title properties over the past year.
Slot said a recent trend was that buyers on the Atlantic Seaboard were getting younger. Analysis of demographics over the past 12 years showed a shift. Buyers were overwhelmingly in the 35-plus age group before 2008 but the 18 to 35 age group now made up about a quarter of buyers.
Wener added that the Western Seaboard was drawing the younger set and areas with good schools, such as the southern suburbs, were attracting families with children.