Sales to international buyers in Cape Town have already surpassed their combined values from 2022 and 2021, primarily as a result of an increase in high-value transactions and a greater number of buyers taking advantage of the weakening Rand.
Economic and geopolitical uncertainties in Europe are also pushing more European buyers to invest in the Cape, according to the Seeff Property Group.
Data from Propstats sales reveals that sales for this year through the end of July have exceeded R2.1 billion, representing a 50% increase compared to the total sales of R1.44 billion in 2021 and a 12% increase over the R1.88 billion total in 2022.
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According to Ross Levin, the Seeff licensee for the Atlantic Seaboard and City Bowl, a sizeable portion of these sales, or about R1.44 billion (69%), took place in these suburbs.
Despite the typical seasonal slowdown during winter, international buyers still contributed R220 million in sales for May and July, respectively, with the highest recorded sales of R280 million in March.
Levin attributes this surge in international interest to relatively stagnant price growth in the high-end property market combined with the depreciation of the Rand. With the exchange rate at approximately R19 to the US dollar, buyers are paying around 35% less than they would have two years ago when it was R14.
For instance, a luxury Camps Bay villa valued at R30 million, which would have cost around USD2.2 million two years ago, now only sets the buyer back approximately USD1.6 million.
Furthermore, Levin notes that properties priced below R10 million are even more attractive compared to what German or UK buyers can find in their home countries. Many of these international buyers also relish the opportunity to spend extended periods in Cape Town.
Even local investors with significant means are finding that they can get more for their money in South Africa compared to other international markets. While most international sales are below R10 million, there have been several high-value transactions, predominantly involving buyers from Germany, the UK and other European nations. Russian buyers, as well as buyers from the USA, are also contributing to this trend.
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These international buyers are acquiring properties for various purposes, including second homes, retirement, work or starting businesses.
Some notable high-value international sales in 2023 include R150 million in Clifton (Russian), R71.25 million in Fresnaye (Russian), R53 million in Clifton (USA), R43 million in Clifton (UK buyer) and R41.6 million in Camps Bay (UK buyer). Other high-value transactions took place in Bantry Bay (R28.5 million, UK), Sea Point (R21 million, UK and R22.7 million, Zimbabwe) and Higgovale (R28 million, Zimbabwe and R22.5 million, Germany).
Camps Bay, in particular, has witnessed a surge in international buyer activity, with sales ranging from R25 million to R41.6 million, predominantly to UK buyers as well as buyers from the Netherlands and France.
According to Nadine Jocum, an agent with Seeff Camps Bay, this trend began with the onset of the pandemic and has continued with the Russia-Ukraine conflict. International buyers are drawn to the city’s climate and coastal lifestyle, and their presence adds to the cosmopolitan atmosphere while supporting the local economy, including restaurants, retail, architects, builders and interior designers.
Francois Venter, lead agent for Seeff Southern Suburbs Uppers (Constantia and Bishopscourt), highlights that buyers from the UK, Germany and other European countries increasingly see South Africa as a viable Plan-B destination.
South Africa’s proximity, similar time zone and outstanding lifestyle make it an appealing option. For example, with 1 Euro million, one can purchase a luxury R18 million home in beautiful Constantia or Bishopscourt, whereas, in Germany, the same amount might only afford a two-bedroom flat.
Sales in these suburbs include R25.5 million in Constantia to a Nigerian buyer for a holiday home and R20 million in Bishopscourt to a UK buyer.
The Hout Bay and Llandudno areas have also experienced a notable uptick in sales to international buyers, particularly from Germany.
Stephan Cross, Seeff’s sales manager for the site, notes a significant increase in the R10 million-plus sector in Cape Town, especially in Hout Bay, due to the favourable exchange rate and current economic and geopolitical instability in Europe.
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European buyers are seeking alternative markets and lifestyle changes, with Cape Town standing out as an ideal choice due to its well-run governance, sustainable quality of life, stunning beaches, nature and attractions such as wine farms.
High-value sales to international buyers in Hout Bay include R20 million (Belgium), sales of R9.5 million, R10.995 million and R12.75 million to German buyers, R10.9 million to an Italian buyer and R9 million to a UK buyer. Llandudno also saw significant sales, including R27 million (USA), R26.5 million (UK) and R24 million (USA).
Notable sales have also occurred in Fish Hoek, Scarborough, Blouberg, Hermanus and Stellenbosch, reflecting the growing international interest in Cape Town’s property market.
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