South African Property News

Johannesburg Property Market Scores

An article on a Holiday Letting website in the UK has drawn attention to property investment opportunities on the up in Johannesburg as the 2010 World Cup approaches. The rest of the country may be experiencing somewhat of a recession in the property market, but Johannesburg seems to be developing a holiday rental market ahead of one of the world’s major sporting events.

There is a “surge of regeneration” that seems to be taking place in many of South Africa’s major cities, particularly Johannesburg. This is believed to be a direct effect of the country’s status as host of the 2010 Soccer World Cup. The government hopes to eradicate townships by 2014 and politicians aim to have new homes constructed instead. However, this is problematic in that as people leave the townships, more and more houses are needed to accommodate them. According to Peet Strauss, of Pam Golding Properties, “Demand for new homes is pushing development in a way we haven’t seen before.” He went on to add that a new market for luxury apartments was developing in Johannesburg.

While not traditionally seen as a holiday destination, Johannesburg is also seeing the establishment of a holiday rental market in and around the city, with resorts such as Zilkaats and Clarens marketing themselves as property investment options. Those in the know are also keen to dispel the idea that foreign investment makes it more difficult for South African buyers to get a foothold in the local property market. “A misperception exists that foreign nationals buy exclusive, expensive homes pushing up prices to the detriment of South Africans. The issue has raised its head on a number of occasions, but nothing has come of it,” says Julian Pokroy, a solicitor specializing in home purchases by overseas investors.

The low property prices in South Africa when compared to British standards, is one of the main draw cards when it comes to overseas investment. An apartment in an affluent part of Johannesburg will usually set buyers back £95,000 and something a little bigger might cost around £235,000. Those willing to widen their search field are sure to find properties at a lower price, as prices drop significantly as you go further outside of the city. Just half an hour’s drive could reward buyers with as much as half the purchase price of properties found in central Johannesburg.

Johannesburg’s infrastructure is also seeing improvements in the run up to the World Cup. There is an underground tube system that is currently under construction and there are plans for a similar development above ground. New roads and shopping malls are being built and the city’s international airport is undergoing expansion and modernization, ready to welcome the international soccer teams and their fans in time for the sporting event in 2010.

The information in this article is courtesy of Holiday Lettings (“South African property market scores as World Cup approaches”, 2 May 2008).

If you are interested in buying or selling property in South Africa, please visit www.sahometraders.co.za.