Now is the time to buy a home in Cape Town, as data from FNB’s latest Cape Town Sub-Regional House Price report shows price decreases in a number of areas across the Mother City.
Those looking to get a property during this prime time will find reduced prices in areas from the Southern Suburbs, City Bowl and the Atlantic Seaboard extending into the Eastern Suburbs like Salt River and Woodstock.
All of these areas showed price declines in the first quarter of 2019 with the Atlantic Seaboard, including Green Point, Sea Point, Clifton, Hout Bay, and Camps Bay, leading the decline.
An average of a 5.1% decline has been experienced by these areas year-on-year, and this is historically the worst noted decrease to date, showing a huge plunge from the previous growth rate of 25.5% in the first quarter of 2016. Taking inflation into consideration, the decline even nears double digits.
Of the areas in the Atlantic Seaboard, according to Private Property only Llandudno still features in the top-ranking suburbs for property growth, coming in at first place.
Area such as Somerset West, Gordon’s Bay and Strand have also experienced a sharp year-on-year price decline, decreasing by 5.3% in the last quarter of 2018 and a further 1.7% in the first quarter of this year.
There seems to be a general trend of upmarket regions in and around Cape Town taking the biggest price knocks this year. Home prices have seen an overall decrease of 1.2% across the city as well as some of the slowest growth rates in the last 10 years.
The Northern Suburbs however have shown particular resilience when compared to other areas in the Cape as well as the Western Seaboard. Area such as Blouberg, Milnerton and Melkbosstrand experience a property price drop from 3.8% last year to 1.8% this year. Area such as Parow, Belville, Durbanville and Brackenfell also experienced growth.
“It is conceivable that the house price deflation we are seeing in some upmarket regions could reverberate throughout the city, resulting in meaningful improvement in affordability. If this happens, any meaningful recovery in national prices would be undermined, which could ultimately prolong the period of subdued house price growth in South Africa. A nominal decline in prices is conceivable at this point,” FNB economist Siphamandla Mkhwanazi told The Citizen.