Small Towns Still Booming in SA

Investment Getaway in the Karoo

An article published in the Weekend Post has drawn attention to the Karoo’s newfound status as a dream location for property investment. In fact, with the rest of the Western Cape suffering from a continuous slump in the property market, the historical town of Graaff-Reinet is literally booming.

The main reason for the comparative boom in the Karoo property market seems to be buyers snapping up affordable housing and taking up a quieter, safer lifestyle. Unlike big cities, property experts believe that small towns are now being seen as ‘havens of peace and tranquility’ that is no longer available in more urbanized areas.

According to estate agents based in the Graaff-Reinet area, while the national property market may be struggling due to higher interest rates and the ever-increasing cost of living, they are battling to keep up with demand in the town commonly referred to as the “gem of the Karoo”.

The country’s fourth oldest town, Graaff-Reinet is renowned as the Karoo’s biggest tourist destination. Estate agents say that its popularity is growing among middle and high-end buyers, with small two or three bedroom homes selling for over R550 000 and a historical four bedroom home selling for R3.3 million.

Wayne Rubidge, Pam Golding principal for the area, says he thinks, “There is a combination of reasons why there is an increased interest in Graaff-Reinet. There is a great community, great schools and a growing economy – people are making serious lifestyle choices”. According to Rubidge, artisans, contractors and other property-related service providers are booked up months in advance, which is all indicates a booming property market.

Ken Ralph, national vice president and chairman of the southeastern region of the Institute of Estate Agents of South Africa, says that he has seen an increasing trend where buyers are moving to smaller communities along the Garden Route, primarily because of the improved cost of living and better security.

“Security is a big drawcard for people. The cost of living is also not as high in bigger city centres,” Ralph said. Rubidge adds that the influx of “new blood” into Graaff-Reinet is creating a number of new job opportunities in the region. “There has been a boom in new business as well. New skills mean new industries, fresh thinking gives new perspectives and opportunities,” he said.

Essentially what is driving the growth of industry in the town and fuelling the region’s economy is a combination of traditional sheep and livestock farming and the more recent game, wildlife and leisure practices, according to Rubidge. “This has positive spin offs for the property market and a new term commonly heard is ‘investment getaway’ – frequently used in describing homes in the R1 million to R2 million price bracket”.

Gillian Kleynhans, and estate agent for Midlands Properties, has noticed a significant increased in property being sold for business purposes. “We have seen a growing interest in all aspects – people looking to open businesses, or buy residential properties and smallholdings. People don’t only want to look in town, but surrounding areas as well,” she said.

Agreeing with Rubidge, Kleynhans says that the main attraction factor for buyers is the improved quality of life. “Our kids can still ride their bikes to school, it’s a lovely place to live and raise a family,” she said. “You have some people who are not in full retirement who want a smallholding. It is the best of both worlds – you can grow your own produce and be part of a vibrant community at the same time”.

According to Jenny McNaughton, of Seeff Properties, “There has been some international interest but most of the calls I have received have been from people in other provinces. People want to get away from the crime and daily traffic”.

The information in this article is courtesy of Melody Brandon (“Boom as buyers discover Gem of Karoo”, Weekend Post, 26 July 2008).

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