South Africa’s coastal property market is triumphant

 COASTAL PROPERTY|

             

Despite last year’s rapid interest rate hikes, the coastal property market shows remarkable resilience.

BY: Kobus Du Toit 

Property Informer affirms that the demand for coastal property remains strong. This is good news for up-and-coming property investors eager to explore the buy-to-let market and take advantage of South Africa’s spectacular coastline of over 2,500 kilometres, home to many charming coastal towns that offer excellent investment opportunities

Let’s explore promising investment opportunities in today’s flourishing coastal property market.

Top Coastal Property Destinations for Your Next Investment

Are you looking to invest in a property with a prime location? Look no further than Hout Bay. It’s the perfect alternative for those seeking proximity to the Atlantic Seaboard and the Southern Suburbs

According to Kobus Du Toit, our coastal journalist in Camps Bay, the area provides a quaint-like lifestyle, with excellent amenities such as top-rated restaurants, schools, and shopping centres.

Plettenberg Bay, located along South Africa's Garden Route, is another popular destination for beachgoers and outdoor enthusiasts. The town offers a range of investment options in the coastal property market, including luxury beachfront villas, apartments, and buy-to-let properties.

Gqeberha (formerly known as Port Elizabeth) is a thriving coastal city that has seen a rise in property demand due to its beautiful beaches and stunning coastline.

With its mild climate and numerous amenities, Gqeberha offers excellent investment opportunities in the coastal property market, from beachfront apartments to holiday homes.

Mossel Bay, situated along the Garden Route, is another famous town offering excellent coastal property market investment opportunities. With its beautiful beaches, nature reserves, and numerous outdoor activities, Mossel Bay is an attractive destination for tourists and retirees

The town offers investment options, from luxury waterfront properties to buy-to-let apartments. It is an ideal location for those seeking to invest in the flourishing coastal property market.

The Hout Bay and Llandudno area achieved a record-breaking year in sales in 2022. Hout Bay concluded the exceptional year with over R1.3 billion in sales generated from 457 transactions, setting another record. The average transaction price has also surged to R4,389,960 (from R3,518,090 in 2021), driven by an increase in sales of properties within the higher price bands.

Llandudno finished the year on a high note, with 18 deals totalling R478 million, a significant increase over the previous year's eight sales totalling R143 million. Notably, the neighbourhood had many transactions above the R20 million level, indicating its prominence in the luxury property market.

Kobus Du Toit,  coastal journalist for Property Informer, confirms that despite a slowdown in sales for some areas, the coastal hotspots remain resilient.

Coastal Property in Plettenberg Bay

The booming coastal property market of Plettenberg Bay is an investment opportunity you can’t ignore. The area concluded the year with around 800 transactions, totalling an overall value of approximately R2.3 billion.

With an average transaction price of around R2.6 million, up by 4% compared to 2021 and a staggering 30% increase from 2019, Plettenberg Bay continues attracting buyers looking to invest in high-value transactions

The luxury market is robust, with several sales above R10 million and three sales above R20 million, all in Seaside Longships. While coastal freehold property makes up about 70% of all property stock in the area, there is a solid swing in estate property sales, according to Lightstone data. 2022 saw 36% of transactions related to properties in estates and 39% to other freehold properties.

Harry Smith, licensee for Pam Golding Plettenberg Bay, comments that while the number of transactions was slightly down compared to the record year of 2021, the overall value remained impressive

Coastal Property in Mossel Bay

Mossel Bay has solidified its position as a top coastal destination for property investment, with a thriving market and high demand. The town's prime location, exceptional lifestyle offerings and excellent value continue to attract semigrators, retirees, and holiday home buyers alike.

Pam Golding Mossel Bay's Sales Team Leader, Herman Spies, confirms that sellers had the upper hand in negotiations towards the end of last year, as the market moved quickly with less available stock.

Full-title residential properties in Mossel Bay boast an average price of around R2.8 million.

With the average transaction price of R1.7 million in Dana Bay, R1.8 million in Diaz, and approximately R1.8 million in Island View and Reebok, respectively, these areas are excellent investment opportunities.

Properties priced below R3 million are in high demand, and the limited supply of vacant land has doubled prices over the past year.

Coastal Property in Gqeberha (Nelson Mandela Bay, Eastern Cape)

Seeff Eastern Cape and Garden Route's regional manager, Alan Phillips, suggests a metropolitan area is a superb option for those seeking a coastal property, as it still provides lower price points.

The region offers an excellent standard of living and urban conveniences, such as reputable schools, tertiary education (including Nelson Mandela University), impressive shopping centres, and ample recreational facilities.

Even though the 2022 property market is somewhat slower than the previous year (which was the best in a decade), it remained highly competitive and active, according to Phillips.

Sellers can take advantage of the scarcity of available properties. Phillips notes that the market is less noteworthy for semigration, but is very active among locals (particularly first-time buyers).

Take advantage of the opportunity to invest in South Africa’s coastal property market. There are many charming coastal towns to choose from, and as the demand for coastal property skyrockets, you could secure a reliable stream of passive income if you buy to rent.