If you are in the market for your first or new home, it’s worth keeping your investment affordable and your property small. In the current South African market, smaller, affordable properties - especially townhouses and apartment blocks - tend to appreciate faster. This means that if you sell in a few years’ time, you’ll get a greater return than if you had bought a bigger, free-standing property.
The statistics bear this out. According to the FNB Estate Agent Survey, homes with an average price of R583 858 grew in value from 7.1% year on year in the third quarter of 2017 to 7.6% year on year in the fourth quarter. Over the same period, homes with an average price of R2.355 million decreased from 5.6% to 5.1% growth year on year.
The reason that these more affordable properties tend to hold their value better is that there are more people entering the market and re-purchasing in the market at this level. In addition, smaller homes are generally more popular because they are easier – and cheaper – to maintain. Security it another benefit, as these homes are often located in complexes.
Smaller homes are generally more popular because they are easier – and cheaper – to maintain.
As an added bonus, buyers pay no transfer duty on homes under R900 000, so if you can get an offer accepted on a property beneath that threshold, you’ll save yourself a whole lot of money.
For all these reasons, small, affordable homes in complexes are the way to go. We took a look at what a buyer can get for under R1 million in apartment and townhouse complexes in South Africa’s leading metropolises. We looked at properties with a minimum of two bedrooms so that they have the flexibility to cater to a buyer’s changing needs.
Johannesburg – R870 000 This two-bedroom home nestled in central Corlett Gardens is tiled throughout, with granite tops in the kitchen and a small private garden. As an added bonus, this complex is pet friendly.
Cape Town – R895 000 This two-bedroom, one-bathroom, first-floor apartment in Kenilworth comes with two parking bays, a complex pool and 24-hour security. It’s five minutes from Kenilworth Centre, and close to the motorway.
Durban – R950 000 This three-bedroom townhouse in Clare Estate in Durban has 24-hour security and is close to all transport and amenities. It has a large balcony and access to a separate laundry area.
Pietermaritzburg – R960 000 This beautifully styled, three-bedroom, ground-floor apartment is situated in a landmark building. It’s close to town for a busy professional seeking a lock-up-and-go lifestyle, surrounded by gorgeous gardens.
Bloemfontein – R657 000 This neat townhouse in Langenhovenpark already has a tenant, so it makes a great investment property. It is situated in a safe complex and has two bedrooms, an open-plan living area, a neat kitchen with a scullery, and a small private garden.
Port Elizabeth – R699 000 This lovely, double-storey face brick unit in a well maintained complex is walking distance from primary schools and shops. It has three-bedrooms with built in cupboards, a spacious open-plan lounge and a garden off the kitchen.
East London – R995 000 This newly renovated two-bedroom, two-bathroom apartment in Beacon Bay overlooks the valley from a private balcony. The secure Triple Point Moya Estate has a communal swimming pool, laundry and playground.
So there you have it - a selection of smaller, affordable properties in complexes. Homes like these will likely appreciate in value faster than bigger, free-standing properties.