Luxury home buyers with an eye on value are forsaking traditional hunting grounds for Lambton and Klippoortje in Germiston, Gauteng where similar properties cost up to three times less than in areas such as Bedfordview. This is according to Simon Smith, principal of Harcourts Full Circle in Germiston.
Klippoortje and Lambton, which has the added advantage of being on the doorstep of Germiston's upmarket retail and business hub in Webber Road, are proving particularly popular with young family buyers who want spacious grounds, generous accommodation and living areas and proximity to Germiston's finest schools, says Smith. Homes in these suburbs range in price from R1m to around R3m, whereas the same properties in nearby Bedfordview are significantly more expensive.
Germiston is more than holding its own in the current property market. Buyer activity is most prevalent in areas such as Elsburg and Tedstoneville, which he describes as a quick moving, value-based market. It's to these suburbs that people are relocating from traditional townships such as Vosloorus and Katlehong, intent on upgrading their homes and being closer to their work places and transport routes. The most sought-after price range is between R450 000 and R600 000, which will typically buy an older, three bedroom house.
Developers show interest
Smith also reports good buying interest in middle market suburbs such as Hazelpark and Dinwiddie, where freestanding family homes cost anywhere from R750 000 to R1m. A very large percent of these buyers are Eskom employees and civil servants with easy access to home finance through their employers.
Underpinning the viability of Germiston's residential property market is the re-emergence of developers. "We've had quite a few calls from developers in the last few weeks, most of whom are looking at the lower end of the market. In all likelihood, this will translate to the construction of two and three-storey blocks comprising units of around 50m2 in size," Smith says.
To buy successfully in Germiston's market, it's critical to have an unblemished credit record. "The banks are still very risk-shy, declining up to 50% of all loan applications. The chances of getting a loan are pretty remote for applicants with adverse comments on their credit records."
Access to sufficient funds
Further to this, he says it's common practice at the moment for the banks to grant bonds for less than the amount requested. "Buyers must ensure that they have access to funds that they can use to pay not only costs but also any shortfalls should the banks grant them less than the amounts for which they applied. Also, prospective buyers need to work out what they can afford based on their disposable income. The focus needs to be not on what you earn but what you can afford to pay each month," says Smith.
For sellers, he pulls no punches. "You won't see an offer if you don't price correctly," he says. "And, if your property has been on the market for six months or more, you need to consider that you're dealing with the wrong agent. Most buyers start their searches on the Internet so make sure that when selecting an agent to market your property, they belong to a company with a proper website and which has links to the big property portals."
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