Upward trend in Plett property sales dips slightly
Category Property Sales in Plettenberg Bay
Plettenberg Bay's property market appears to have taken a breather after some hectic activity in the past year, the latest property registration figures for the first half of the year to June show.
While properties totalling over R16 billion were registered with the Deeds Office between January and June this year. The second quarter figures show a slow-down of -4,6%, compared with the second quarter sales in 2021.
The good news, overall, is that the sales figures for the first six months of the year are up by 6,57%.
Another significant pointer is that sales of vacant land has spiralled. This is especially apparent in two suburbs where the majority of sales that took place were vacant land- Baron's View, which is 650% up with 30 sales registered and Schoongezicht, 118% up, with 24 property registrations having taken place.
"The appetite for property in Plett is still healthy," says Helen Ward, Principal of leading Main Street real estate company, Helen Melon Properties. "And we're seeing other trends emerging. But the key challenge we still have is the availability of stock," says Ward.
The semigration trend to the Cape Peninsula, like Plettenberg Bay, has fuelled house prices and depleted stock of available homes for sale. Prior to the disruption of the pandemic, semigration toward the coast was on the rise and since the end of lockdown, there's not only been a resurgence in the migration tide, but also a steady upward trajectory of property inflation in these areas during the past 12 months.
The latest Lightstone Residential Property Indices highlights a spike in enquiries from upcountry buyers and the flow of investors is clearly an indication of this. It also reflects an increase in inflation, which could explain higher property prices.
During the Q1 of 2021, coastal property inflation increased from 5,9% to 6,2% and non-coastal at 5,6%, but Q2 this year, property inflation on the coast had risen to 8% while inland it had dropped to 4.9%.
The latest Rode report says South Africa's property sectors are being negatively affected by increased worries of local and global economic growth amid even higher inflation and interest rates as highlighted in its previous report. The housing market showed a steady start in 2022, with nominal prices growing by about 4% year-on-year during the first five months.
The report says "at this stage, the impact of interest rate hikes has not significantly slowed prices and volumes, but it will increasingly play more of a role in curbing effective demands as it increases towards its pre-pandemic level of 10% sooner rather than later".
House prices are expected to grow more slowly over the next year due to the weaker economy, characterised by high unemployment. And as interest rates rise further, this will place additional pressure on consumers who are also facing inflation. Real house price growth is still a few years away, says the report.
A breakdown of the sales activity in Plettenberg Bay during the first six months reflect:
Barons View - Up by 650% - record sales of 30 properties in first half. Of those 22 were land sales compared with four sales in 2021. These sales can be attributed to lack of stock in land sales
Brackenridge - Down by -48.65% - due to lack of availability only 19 properties were sold (eight stands and 11 houses). Traditionally Brackenridge's high sales have been due to land sales.
Cutty Sark - Up 138.89% - this could reflect the renovated units in Castleton, which has shown increased sales activity.
Lower Central - Up by 75%
Schoongezicht - Up by 118.18% - sales of stands show a marked increase with 15 land sales.
Seaside Longships - Down -41.89% - due to lack of stock.
The Hill - Up by 166.67% - eight sales in 2022 from three in 2021. These are not big numbers but show traction in areas that previously have not been moving.
Wittedrift - Up by 133.33% - Sales have also increased, but in small numbers. This may be due to affordability as the sales could reflect more affordable lifestyle homes and entry level interest.
Author: Helen Melon Properties