Very fast sales at Fountain Views show the importance of meeting today's market needs.
alf way through the third week following the launch of Brick n Board’s Brackenfell development, Fountain Views, 46 of the 61 apartments had been sold – and Rowan Alexander, Director of Alexander Swart Property, the estate agency responsible for the sales and the marketing of Fountain Views, said that Alexander Swart Property expected a full sell out by October.
“The very fast sales here,” said Alexander, “have come about for one main reason: the development was designed for today’s market.”
Recently, said Alexander, a slowdown had been seen in many developers’ Northern Suburbs sales because their projects are geared to higher end buyers and these are not as thick on the ground as they were formerly. Fountain Views, by contrast, exactly meets the needs of today’s buyers, many of whom are looking for a new, well designed apartment priced very close to R1million. Prices at Fountain Views are from R1,145,000.
Alexander said that his comments on the current market had been corroborated by the estate agency Remax, who reported recently that for the first time in many years some Cape Town rental apartments are standing empty and landlords are cutting their rents by 10% to 20% and getting returns as low as 4,5% whereas previously the average was 6%.
John Loos, FNB’s property analyst, said Alexander, has expressed a similar view: he pointed out that there has been a tailing off of demand at Cape Town for high end properties, most notably those on the Atlantic Seaboard and in the City Bowl.
Loos said too that although the more affordable suburbs, especially those to the north of Cape Town, had been less affected, they have witnessed a shift in demand to relatively less expensive rental and bought properties.
Loos, said Alexander, has attributed the recent less optimistic market conditions to a slowing down in the migration to the Cape from other South African provinces (at one stage non-Capetonians were responsible for 12% of all Cape Town’s property buys). This, in turn, Loos believes, has come about as a result of the water restrictions, the widely reported tensions in the local DA administration and, as elsewhere in South Africa, the increase in VAT to 15%.
“Most of these rather disheartening influences,” said Alexander, “were identified and in fact publicised by the Alexander Swart Property team as much as 12 to 18 months ago. As a result, we were one of the few agencies able to influence developers to tailor their projects towards today’s changing market.”
Asked what specific advice he and his colleagues had given Cape Town’s Northern Suburbs developers, Alexander said that they had recommended that buy-to-let properties be priced below R1,7 million, while buy-to-occupy properties should be below R3 million.
“What the fast sales at Fountain Views show,” said Alexander, “is that there are still very good opportunities in the now popular buy-to-let developments if the price is right – at Fountain Views the apartments were brought to the market at R1,145,000 and R1,350,00.”
In the buy-to-occupy market, with his agency’s help, said Alexander, several new projects will be launched over the coming year and these too he expects to sell well but those projects launched at prices above the levels mentioned can often take a year or more to sell.
Fountain Views sales, added Alexander, have also shown that:
· there is no need to rely on upcountry buyers: all the buyers so far have been from the Greater Cape Town area. Eighty percent of the buyers have either been property owners in Brackenfell or have businesses there; and.
· downscalers and first time buyers are important in today’s market: at Fountain Views they comprise 30% of the clients.
· the developers’ reputation built up over several years is crucial to the success of such projects: Brick n Board’s standing among Northern Suburbs clients, said Alexander, is very high.
· the average Northern Suburbs resident’s faith in the Brackenfell property remains very strong.
For further information contact Rowan Alexander on cell phone number 082 581 3116 or by email rowan@asproperty.co.za.
25 Jul 2018
Author Independent Author