If you list your property with a fair selling price it will very likely be achieved, despite the economic climate.
Some of the most important reasons for selling include downscaling, emigration, relocating within South Africa (‘semi-grating’), upgrading, and relocating because of security considerations or a change in family structure.
Seeff asked two of their experts in Sandton and Centurion to elaborate to which extent each of these factors contribute to sellers listing their properties in these areas.
Charles Vining from Seeff Sandton, says downscaling due to financial pressure in Sandton usually occurs when people who were considering downscaling in any event because of something like a divorce or retirement scenario are then spurred on and hurried up by financial pressure.
“This is most evident in the middle-market segment where someone will for example sell their R3 million plus home and move to something at R2.5 million or below.
It’s not only the cost of the house that makes the difference. Municipal rates and/or complex levies, as well as the cost of maintaining large grounds or large houses also play a role.
Downscaling is not area specific but it does tend to apply more to freestanding homes as opposed to cluster homes”.
Vining continues that they also see a fair share of emigration as a driving force behind selling in Sandton.
“Emigration is not only due to crime rates or family ties abroad, but because the majority of homeowners in Sandton are professionals and have skills that are needed in foreign countries - from teachers and professors to audiologists, specialist doctors to bankers and attorneys.
Moving to English-speaking countries are prevalent choices and a fair amount of sellers are also relocating to other African countries on expat contracts”.
Vining adds that semi-grating of particularly retirees to the Cape or warm Kwazulu Natal areas is also a definite trend in Sandton.
“There is always a lot of upgrading going on in our Sandton, Fourways and Midrand suburbs.
Some families upgrade because of spatial necessity to accommodate their growing family and others upgrade as they advance in their careers - the classic case being from an apartment to either a penthouse-style apartment, townhouse or cluster home.
From a cluster home, people often move to a freestanding house in an estate or a home on large grounds in suburban areas”.
Vining concludes that they also see owners selling their property and moving to security villages or complexes particularly if the family has been in the unfortunate situation of having been victims of crime.
“Relocating to be closer to work and schools is also evident as traffic is a serious consideration in Johannesburg.”
Tiaan Pretorius, a Seeff agent in Centurion, says about 5% of new properties listed in Centurion belong to people who are under financial strain and are forced to downscale.
“We are seeing this across the board - from the owners of small townhouses to those who live in estates - and most prefer to find a smaller property in the same area or closer to work to reduce commuting costs. Generally these sellers move to properties that are anything from 25% to 40% more affordable than their current property.”
Pretorius adds that about 5% of their listings are from people who are emigrating to countries like Australia, the UK, New Zealand and Canada due to personal views about the government, crime and the economic climate.
“While there are some sellers (particularly retirees) who sell in order to semi-grate to especially the Western Cape it is not a large percentage. These sellers often move from estates or middle class suburbs.”
Pretorius continues that in Centurion they don’t see as much upgrading as they used to but when people do upgrade it is mostly because of necessity (bigger properties or properties located closer to good schooling) as opposed to indulgence.
The home values they move from are from R750 000 to R900 000 and R1. 2 million to R1.8 million if they are moving from sectional title to homes in the suburbs. R1.2 million to R1.8 million and R2.2 million to R3.5 million seems to be the price range when they move from the suburbs to estates.
Author: Seeff, 24 October 2018, News