Property in Sandton is a solid investment, says Seeff
In Sandton the demand for property is experienced in price ranges from R500 000 up to R50 million, at varying levels and at different times, but the greatest demand remains for property in the R850 000 to R2.5 million range. Even though this is the case, Charles Vining, Seeff's Managing Director in Sandton, says that this branch has sold several properties in and around R15 million this year. "Sales over R20 million are scarce, but they do happen occasionally. There has been a definite increase in activity in the luxury market and we have quite a few premium properties, including several that are not on the open market, but available to view by serious buyers that qualify to purchase property in excess of R50 million. A significant amount of interest for lavish properties comes from buyers on the African continent, but the majority of buyers in the upper end are South Africans, particularly successful businessmen- and women. Vining continues that the rental market in Sandton is on the up and the year-on-year growth for the Seeff Sandton rental office has increased to 15%. This is mainly due to the area's extensive commercial development in the past couple of years that has led to an unprecedented demand for rental accommodation. Vining continues that rentals in Sandton can fetch anything from R6 000 per month for an entry level apartment in Bryanston or Houghton up to R50 000 per month for luxury homes in Fourways Gardens, Sandhurst, Hyde Park or Morningside. Occasionally, top-end homes at rentals of R75 000 to R100 000 per month are seen too. "High-end rentals have had notable demand in the last few weeks. We have concluded several high end leases - many in the R40 000 bracket, some in the R50 000 bracket and recently a rental for R80 000 per month. The highest rental demand in Sandton however is for two bedroom and two bathroom garden units in secure complexes, at a price of between R8 500 and R10 500 per month. Although these can be found in suburbs like Bryanston and Houghton, the same units will cost around R15 000 per month in Hyde Park or Sandhurst. A bachelor or studio apartment in Sandton central will cost around R7 500. A one bedroom apartment can be picked for the same price or even less in suburbs like Bryanston or Houghton. Family homes with gardens and good security can fetch from R30 000 per month in Sandhurst, R25 000 per month in Hyde Park, R30 000 per month in Bryanston and R20 000 per month in Houghton. Seeff also handles corporate leases for between R40 000 and R50 000 per month in Sandton and Fourways Gardens. Vining concludes that above inflation rental escalations are being achieved and rental yields of up to 8% are possible in especially rental stock at lower price levels. "In general we expect the northern suburbs of Johannesburg, and particularly central Sandton and surrounds to sustain its current position in terms of market demand and sales that are realised. Although there is economic pressure, we believe that property prices will continue to increase in relation to inflation. The gap between a seller's expectations, which is currently high in terms of price expectation and the prices that buyers are willing to pay, will narrow. Astute buyers will not over-pay for property, but will pay fair value. Unfortunately, many sellers in the market are over-priced by an average of 10%. Property in Sandton and surrounds remains a solid investment, particularly for investors with a long-term view. As the CBD continues to expand the surrounding suburbs become more and more desirable".
