Real Estate Investor Magazine South Africa November 2015 | Page 25

REI RESIDENTIAL

EXPERT Q&A

CAPE TROPHY HOME ACHIEVES NEW PRICE RECORD FOR CLIFTON

Dr Andrew Golding

A

luxury villa in Nettleton Road, Clifton, recently sold by Seeff agent, Lance Cohen to
a Johannesburg-based buyer for the top price of R111 million.
The home was designed by Stefan Antoni who is responsible for many of
the iconic designs on the Atlantic Seaboard. The multi-storey home offers an almost
unmatched location, accommodation and finishes, from the massive 1381sqm in floor
space served by a private elevator to the large glass windows and stack-back doors that
opens the home to spectacular views – the ocean to the front and Lion’s Head to the rear.
The home includes a master suite that covers the entire first floor, a house manager/
butler’s apartment, a high-tech 10-seater cinema, gymnasium, store rooms, a multimedia and electronics control room and top class finishes including state-of-the-art
underfloor temperature control (heating and cooling) throughout. To the front is a
suspended terrace with a signature arch as well as a heated rim-flow pool that stretches
across the length of the house and overlooks the ocean.
This is a new record freehold house price for Clifton, the previous highest being R60
million paid for a Nettleton Road property in 2010. This price, says Cohen, has now
cemented Clifton’s position as the top suburb in the country and once again affirms
the Atlantic Seaboard as the place where wealthy buyers, not only Capetonians and
Johannesburgers, but from across the globe want to invest their money.

Q

Has there been a noticeable drop in sales? If yes,
what are the sales figures compared with last year
this time, and the year before?

There has definitely been a material reduction
in sales activity as measured by the number of
transactions concluded.

While there are exceptions to the general trend
in certain market segments, the number of sales
concluded is approximately 30-40% lower year on
year and possibly as much as 50% when compared
with the previous year.

Q

Has there been a decrease in sale prices of houses? If
so, are houses being sold for much less than they are
worth, or are owners still getting good deals?

Depending on the source of the information, there are
different opinions on the extent of price reductions.
It is also true that in certain market segments, where
buyer demand is strong and houses are unique, prices
have tended to maintain their levels.

However, on average, prices have probably decreased
by about 10% year on year. Depending on the
circumstances of the seller and the location of the
property, an owner may still achieve a price not
dissimilar to that achievable 12 months ago.

It is also true that a distressed seller may have to
accept an offer much greater than the average 10%
price reduction and may also be in a position of
negative equity (outstanding bond exceeds purchase
price).

Q

Has Pam Golding been directly affected in any way
by the economic downturn? For example, several
agencies have had to close down offices, retrench
staff, etc. Has Pam Golding experienced any of this?

Inherent in today’s trading environment is the fact
that smaller real estate operators simply do not have
the economic reserves and infrastructure to cope with
current conditions, and as a result may drop out of
the market, as they have historically done in tighter
times.

At the same time, sellers and buyers seek the safety
and security of the larger, blue-chip operators in the
real estate market, which is why companies like ours
have traditionally grown market share in difficult
times, and this year should prove no different.

RESIDENTIAL HOUSING SECTOR IN SURPRISINGLY POSITIVE
TERRITORY, SAYS DR ANDREW GOLDING

D

espite a current rather gloomy economic environment, the residential housing
sector has been in surprisingly positive territory, reports Dr Andrew Golding, chief
executive of the Pam Golding Property group.
“Our interpretation of this somewhat surprising trend is that housing demand
continues to outstrip supply and like many other parts of the world, the housing shortage
in South Africa generally speaking, is on a significant scale in virtually all segments of
the market - and while taking into account affordability concerns and constraints, that
demand continues to fuel price appreciation and new stock supply.
“Since the middle of 2012 we started to see a trend of firstly nominal house price
growth and then above inflation house price growth across many segments of the South
African residential property market. Within these there were and are, as to be expected,
significant pockets of under- and over- performance, with an example of the latter being
house price growth on the Atlantic Seaboard in Cape Town of more than 20 percent for
the past 12 months.”
Dr Golding says three notable outperformers stand out - the lower end of the
residential property market, the sectional title market and the major metropolitan areas.

www.reimag.co.za

NOVEMBER 2015 SA Real Estate Investor

23