Unfortunately it is not always possible to see the immediate potential of an area, but many suburbs in Gauteng are proving that they were worth considering.
Below Seeff’s experts elaborate on the areas that were good investment spots a couple of years ago and name the suburbs they believe are hot now.
Sandton
Charles Vining, Seeff’s MD in Sandton, says while many suburbs in Sandton stand the test of time and are good for property investments because of their accessibility to the Sandton CBD, Illovo and Fourways are two stand-out suburbs.
“While the median price of a sectional title apartment in Illovo was R850 000 in 2009, this price has doubled in 10 years. The median price currently is R1 650 000 - taking one, two and three bedroom properties into account.
Illovo is continuously increasing in popularity because of the prime location in terms of proximity to Rosebank and Sandton. The area also offers “golden oldie” buildings where apartments can be purchased at reasonable prices for living or for renovation purposes.
Vining continues that Fourways is an enormous geographic region and includes a collection of suburbs where annual sales exceed R4 billion. Of the 2 500 plus homes that sell in Fourways each year, prices can range from R600 000 to R15 million.
Many homes are sectional title or cluster-style, and estates like Fourways Gardens, Cedar Lakes and Dainfern remain most popular and provide solid return on investment.
Property prices have remained steady in the Fourways area, and the area is ever-expanding – shopping centres, entertainment zones, private schools and hospitals, and road infrastructure have all been upgraded and continue to be. There is a property style and price for anyone looking to be in this region.
Fourways Gardens residential estate has long-since been popular with corporate tenants and many properties here have achieved very good rental prices in the last few years and this is expected to continue.
Bedfordview and surrounds
David Ingle, Principal of Seeff Edenvale & Bedfordview says that Linbro Park and Modderfontein around the planned Gautrain station will without a doubt be some of the hottest investment property in Gauteng over the next ten years.
“These areas will present opportunities in the residential space with cluster homes, sectional title apartments and high rise apartments eventually on offer as well. In addition to the residential opportunities, there will also be numerous commercial, retail and office development opportunities.
Ingle continues that people who bought in Greenstone in the past and continue to buy here has a sound investment.
“Greenstone and surrounding suburbs have been referred to as the ‘New Sandton’ and it is especially capturing the imagination of young first time buyers.
In 2003 Greenstone Hill was launched by Heartland as the first large "live, work, play" environment in the North Eastern part of Johannesburg. It now consists of 8 000 households, some commercial business parks and four shopping centres, including Greenstone Mall and Stone Ridge Mall.
Its key success factors are the mix of secure housing estates, including clusters and townhouses with good facilities. The area has good access to Sandton, Eastern Jhb, Midrand and Kempton Park”.
JHB CBD
Byron Cornish, a Seeff Licensee in the JHB CBD, says anyone who has invested into this area is realising great rental yields.
“The ability to raise finance is also becoming easier as the major financial institutions are valuing the assets a lot closer to OTP prices, which is providing sustainability of capital appreciation for investors”.
Cornish says a shortage of student accommodation offered by tertiary institutions close to the Johannesburg city centre have resulted in an almost unprecedented demand for student rentals in Braamfontein and surrounds - as long as investors provide the correct product to the demanding market.
“The high rentals to purchase prices create a huge opportunity for investors chasing cash flow yields over 10% net.
Well managed Air Bnb apartments are also seeing great returns in and around the banking districts, sustained by business travellers and City tourists.
The CBD residential market is made up mainly by investment buyers, with opportunities to enter into the market ever present.
Not only has Braamfontein become a cultural student hub with an incredible vibe making it an interactive place to live, work and study, but it is also an authentic tourist attraction that is safe and accessible on world class public transport.
Fundamentally the area is a major opportunity for seasoned investors and entrants into the property market at very affordable levels”.
Randburg
Eloisé de Stefanis, Operations & Sales Director at Seeff Randburg & Roodepoort, says demand for property in Randburg - especially the suburbs bordering Sandton - is high due to the good value for money and accessibility to the Sandton CBD.
“Greenside offers both close proximity to Sandton and excellent growth in property values. Values increased from an average of R1.8 million in 2009 to an average of R3,110,000 in 2019.
Demand for properties near good schools is still recognised with the Linden area showing incredible investment opportunity. Investors that recognised Linden a few years back would appreciate this gem in their portfolio today.
Freehold properties escalated from a mere R1,450,000 for an average home in 2009 to a current average price of R2,975,000. Even more impressive is sectional title units which started at an average price of R780,000 in 2009 and is now averaging at around R2,125,000”.
De Stefanis adds that Jukskei Park also provides an excellent investment opportunity with lower rates and taxes than Sandton and accessibility to the Fourways Business node.
“Here average property prices increased from R1,090,000 in 2009 for a home to R2,050,000 in 2019”.
She concludes that should the Gautrain be extended to Randburg it would possibly mean that investment in Ferndale sectional title would create opportunity in a few years.
“The timeline is uncertain however and as with all investments it’s always easier to recognise and identify a good investment when it’s already too late”.
Kibler Park & Johannesburg South
Trevor Sturgess, Seeff’s MD in Kibler Park, says hot property five years ago in the Kibler Park area was the new affordable homes built by Cosmopolitan in the sister suburb of Alveda Park.
“Homes were selling for as little as R500 000, but today it is almost impossible to get a house in the same area for under R800,000 and they reach over the R1 million mark”.
Sturgess adds that he predicts larger older properties in the suburb to be sub-divided in the near future with new smaller houses being built on the remaining extent or the old structure will be taken down and between four and eight sectional title units will be built.
If these prediction are correct hot property in Kibler Park right now is a 1,000m2 erf with an old house for R1 million or less”.
Duane Butler, Seeff’s Regional Manager for the Northern Division says Brackenhurst and Brackendowns, two suburbs of Alberton also offer great value for money with an average selling price of around R1.5 million for Brackendowns and around R1.7 million for Brackenhurst in the current market place.
“The average selling price was around R900 000 some ten years back and I believe it will be around R2 million in the next two to three years”.
Butler adds that suburbs close to Soweto like Naturena, Meredale, Ridgeway and Mondeor will also experience good overall growth as supply and demand will push the average selling prices up.
All of these suburbs are well located, close to the CBD and have good roads and transport infrastructures”.
Centurion
Steve van Wyk, Seeff’s MD in Centurion, says people who bought properties in the newer estates in the area and sectional title properties near the Gautrain Station five years ago are reaping the rewards today.
“These properties have had better returns on their sales compared to other properties and they continue to be in high demand.
Due to the fact that safety and security have become increasingly important when choosing where to buy property, Estates in Centurion have become extremely popular and are expected to remain so for the foreseeable future.
This is especially true for Estates that have schools, medical facilities and shops like Midstream Estate.
“My advice would be to either buy in an Estate if you can afford it or alternatively in a new sectional title complex near the highways or the Gautrain. Units with two bedrooms, two bathrooms and a double garage will always fetch the best price”.
Pretoria East
Gerhard van der Linde, Seeff’s Principal in PTA East, says suburbs in the far east of Pretoria like Hazeldean, Silver Lakes and Lombardy are expanding rapidly and are seeing many new access routes and schools, while medical facilities, a shopping mall, office parks, a commercial district, tourism buildings, hospitality and lifestyle living are predicted too.
Van der Linde says reasons to invest in the far east of Pretoria include amongst others the new R44B City Development, dubbed “The East Capital” with access from the N4, the new road known as Hazeldean Road which will link The N4 to the R21, a Gautrain station at the new development and easier access to OR Tambo.
“The whole area offers 12 estates which cater for a wide range of clients, all up market, ranging from stack bachelor units to townhouses and free standing houses.”
Van der Linde says you would have made an excellent investment five years ago in Pretoria East had you invested in property in any suburb close to Menlyn Maine.
“Menlyn is now one of the fastest growing regions in Gauteng and as a result property here and in surrounding areas is booming.
While these suburbs have always been popular, interest in the area is now unprecedented due to the tremendous amount of development and job opportunities created.
All the development in the area has had a positive effect on property values and demand for property in suburbs like Garsfontein, Menlo Park, Alphen Park, Newlands, Constantia Park and Ashlea Gardens has skyrocketed.
“Securing a rental property in any of these areas has become difficult and very competitive and it is no secret that homeowners in these areas are asking a premium for their properties”.
Pretoria North (Jakaranda)
Peter Mokwana, Seeff’s MD for Jakaranda, says hot property in this area five years ago consisted of three bedroom and two bathroom freehold properties on around 600m2 stands.
“Even though there is still a demand for free standing three bedroom properties as rental stock, there is a new trend of people looking for security and therefore buying or renting in secure complexes and estates.
The above especially applies to two bedroom and one bathroom homes. This type of property is sought after by first time buyers in the area, not only because of the security factor but also because it is often more affordable than freehold.
We expect this trend to continue”.
Pictures enclosed:
PIC 1: This three bedroom apartment in Illovo is listed for R2 450 000.
https://www.seeff.com/results/residential/for-sale/sandton/illovo/flat/40938/
PIC 2: This five bedroom home in Midstream Estate is listed for R4 595 000.
https://www.seeff.com/results/residential/for-sale/centurion/midstream-estate/house/34847/
Author: Tanya van Buuren Botma, 16 September 2019, Hot Investments