Although the residential property sector in the Greater Cape Town area is now officially out of its recession, developers are still struggling to get new projects financed and launched, says Heather Cape, Greeff Properties New Developments Sales Manager.
“The main difficulties,” she said, “are that buyers still battle to get bonds and the developers are still unable to get funds for new projects, even when a very high percentage of pre-sales have been achieved.” Greeff Properties, said Cape, now has on its books several hectares of potential development property throughout the Cape Peninsula and further afield which are suitable for projects - but very few takers. In many cases, said Cape, the land has come onto Greeff Properties’ books because the current developer/owner has been unable to go ahead. In some cases the rezoning and plan approvals are already in place and the owners may be open to joint venture proposals.
“Where landowners are going for an outright sale,” said Cape, “there is still a tendency to work on pre-2009 values. As a result, many of the property developments that Greeff would like to have handled have become too expensive for the present market.” Greeff Properties’ development team, said Cape, can, however, play a useful role in putting together potential joint venture partners, sellers or buyers for many opportunities that still exist.
Asked where these deals are most likely to occur, Cape said that in the Cape Town Southern Suburbs and on the Cape Flats sectional title units are very much in demand in the price bracket of R350 000 to R1,2 million. Developers who are looking for land, she added, tend to be reluctant to wait for rezoning and/or consolidation approvals. This is because the preliminary planning stages can take at least a year and will usually be followed by another year’s wait to get the plans passed. In some cases, developers also have to deal with objections from concerned parties and neighbours.
“One of the most promising of the current opportunities,” said Cape, “is a security village on a site in Rondebosch. This site ould take ten units selling for around R2 million each. Its position will ensure that it will be very popular to investors.”
“A number of different sites in Camps Bay are also ripe for development. This is one of the fastest appreciating areas in the Cape and very much in demand with both local and foreign buyers.”
Source: The Property Mag
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