indwe magazine – Dec 2005

Cape of Good Investment
Recent international reports have claimed that our country has the fastest growing house prices in the world. The Wall Street Journal and The Economist have named South Africa ahead of Hong Kong for price growth over the past year; a rise of 24% between the first quarter of 2004 and the same period this year. Some of the rises have been steep – house prices last year were thought to have grown a good 28 to 32%. In all, there has been a consistent growth of 20% over the last five years. All this adds up to property in the Cape being a wonderful investment.
Some of the increases can be credited to low interest rates and foreign investment, particularly when the Rand was weak. As a discovered destination the Western Cape has become a perennial favourite of our overseas guests, and thus accustomed to many a Pound, Euro and Dollar injection. As a result, some properties at the top end of the market have skyrocketed. Overall, the highest average price for a residential home in South Africa is in Cape Town. And to visit the city, you’ll know why.
But, there are signs that the current property boom is starting to slow down, presenting new opportunities for the investor. According to ABSA, during August property prices recorded the lowest month on month growth for some time. Overall the fast price growth experienced mainly represented a “catch up” in Cape property prices, which were far lower than equivalent properties in exclusive cities elsewhere in the world
While there has been a slow down in prices, this does not mean prices won’t continue to increase. Not with the city preparing to host the 2010 World Cup. Cape Town is cleaning up its act and there are numerous developments and improvements taking place. Sections of the Mother City are being lovingly restored.
As Gerlinde Moser of RE/MAX points out, a joint venture between private businesses and the city government has launched a multi-million Rand scheme to boost the conditions of the Cape Town CBD. The Cape Town Partnership plans to build another nine hotels and vastly revamp the shopping districts to create an improved living space for the city centre. To highlight just a few, there is the R460-million Mandela Rhodes Place development, encompassing St George’s Mall and Wale-, Church- and Burg Streets; the R120-million North Wharf Protea Hotel near the Cape Town International Convention Centre; and the R130-million plan for a five-star hotel on Orange Street near the Planetarium.
The rejuvenated heart of Cape Town, targeted for around 2007, is likely then to keep the boom times rolling. And set in the heart of Cape Town is the City Bowl, the prime residential area at the foot of Table Mountain and the magnificent surrounding mountains. At a time when traffic commuting is becoming more difficult and more expensive by the day, the City Bowl is now in more demand than ever. Beach life in Cape Town is just as good as in Los Angeles and Sydney. The Camps Bay and Clifton beaches are just minutes away from the City Bowl. The Victoria & Alfred waterfront draws visitors and residents late into the night and is just 5-minutes away from the City Bowl. Cafés and nightlife in Long and Kloof Street are just down the road, and an opera or classical evening, at the Arts Cape Opera House or the City Hall, is only a few minutes away.
Flowing from the City Bowl, the equally sought after and select areas of de Waterkant, Green Point, Mouille Point, Sea Point and Bantry Bay expand the choice of the Cape Town rising experience.
“It’s a great city for mixing business with pleasure,” says Gerlinde Moser, a leading RE/MAX Property Broker in Cape Town. “With offices in 61 countries I meet prospective investors from all four corners of the globe and I’m happy to say that many fall in love with the city and its people and invest. In fact, they become raving fans of the city.”
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