Real Estate Investor Magazine South Africa June 2015 | Page 30

TRENDS

New Rental
Opportunities
Residents Trade Expansive Homes
For New Urban Lifestyle
BY CAROLA KOBLITZ

T

he lack of student accommodation, entry level
or investment properties has created a gap in
the market with many opportunities open to
smart development and developers. This has seen a
trend emerging whereby commercial properties in the
inner city are rezoned and converted into residential
apartments.
During the property boom of the mid-2000s,
the Cape Town Central City saw a number of office
conversions and new builds bring about the lion’s share
of what is today about 3 500 residential units available
in the CBD. However, it is only in the past three years
that there has been a steep uptake in the market.
“We have seen a huge shift since 2011 and right
now the demand has outstripped the supply. Property
professionals and their clients are crying out for units
under R1 million mark. When these come onto the
market they are snapped up. This is largely indicative
of a ‘new wave’ of long-term investor confidence that
has returned to the market, and many of these units
are either rented out to young professionals who may
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JUNE 2015 SA Real Estate Investor

not yet be in a position to buy, or to the ever-expanding
student market,” says Rob Kane, chairman of the Cape
Town Central City Improvement District (CCID).
Of the 50 properties sold in the Central Business
District (CBD) during the first quarter of 2015, eight
were under the R1 million mark and came in at an
average of R17 596.59/m2. With the average size being
44m2 and the average price of R774 250 (highest R960
000 and lowest R620 000), however, this is starting to
coincide with a new urban, global emerging market.

“Property professionals and their
clients are crying out for units
under R1 million mark.”
According to Dave Russell, a Director of property
consultancy firm Baker Street Properties, who cites
a recent article (“Live small, be happy. The next big
www.reimag.co.za