Holiday home market to pick up over festive season

© tomertu – 123RF.com

Broker/Manager of RE/MAX Coastal, Chris Van der Merwe, says that generally, Knysna, Sedgefield and the Wilderness are extremely popular holiday locations for both local and international holidaymakers. “We find that many visitors return to the region time and time again because they simply fall in love with what the area offers. With some of the country’s most beautiful terrain, it’s easy to see the appeal among holidaymakers and property buyers alike,” he says. “We have seen a number of people who have visited for a holiday, but then have come back to purchase either a holiday home or permanent residence.”

Accessing finance

He notes that while economic conditions surrounding the property market have been challenging for consumers, with a large number of inland holidaymakers visiting during the months ahead, it is expected that the number of property transactions within the region will increase. “Those who have access to the necessary finance can escape to a second home that is away from the hustle and bustle of city life to enjoy the lifestyle benefits these types of properties offer,” says Van der Merwe.

According to Adrian Goslett, regional director and CEO of RE/MAX of Southern Africa, property is considered to be a strong asset class in which to invest, particularly over the medium to long term. A leisure property can prove to be a home to enjoy as well as an investment that generates healthy returns. “However, as with any property investment, when looking to purchase a leisure property there are several aspects that buyers should consider before deciding to commit financially. It is important to look at the key factors that will impact on the property’s investment potential,” advises Goslett.

Aspects to consider

Van der Merwe says that before making a final decision, buyers should find out a few things about the particular location they want to purchase a holiday home in, such as the percentage of property price growth over the last three years, how many homes have sold in the area over the last 12 months, and how many homes are currently on the market in the area. Other aspects to consider include the daily rental one can expect the home to fetch while not in use and whether there are reliable property management agencies in the area. Ask the estate agent to provide a comparative market analysis of the home values in the area.

Highly sought after properties

According to Van der Merwe, holiday homes in the region vary in price from as low as R1.2m to as high as R10m. “This season I believe the most popular price band will be the higher-end properties ranging from around R5m to R10m, purely because these are the homes that are currently available. Buyers in the region will pay more for homes that are close to the water, be it either the estuaries or the beach. These properties are highly sought after among buyers and holidaymakers,” he says. “Other features that make a home more popular among buyers are luxurious finishes, a swimming pool, braai areas and en-suite bathrooms.”

In conclusion, Van der Merwe says that the strong demand for property in the region is set to ensure positive returns on investment over the medium to long term.