Estate Living On The Rise
Pent-up demand for gated lifestyle investments with security
BY MONIQUE DU TOIT
L ifestyle gated estates are a big deal in South Africa . According to a 2016 Lightstone report on estate living , it was found that residential properties within estates make up around 15.1 % of the total market value . This is particularly interesting , since residential estates made up only 5.1 % of the total volume of real estate in South Africa . In 2016 , the average home price in South Africa was R700 000 , with the average home in a gated estate being around the R2 million mark .
Having grown in popularity over the past few years , it ’ s clear that estates aren ' t just a passing trend . There are over 7000 freehold and sectional title scheme estates with a total amount of 335 000 properties with a collective value of R800 billion according to Lightstone and demand is picking up . At least one in ten South Africans choose gated communities when making residential property purchases despite a drop in new estate developments . The latest stats from ABSA suggest that residential building activity has contracted for the first quarter , and projections for the rest of 2017 is to remain under pressure in the rest of 2017 , which will be the result of the outlook for the economy , household finances , consumer confidence and building confidence .
What makes a good estate ?
With a record number of estates around the country , it ’ s important to keep our sights on what distinguishes a good estate from a bad one . A well-known benefit of estates is their security benefit as well and lifestyle convenient aspects . Years ago , this may have meant building a wall around a bunch of houses and calling it a day . In today ’ s market , however , advances in technology have meant the bar is considerably raised .
As Dr Andrew Golding points out , however , it goes beyond security : “ The trend is towards so-called lifestyle estates which encompass work , live , play and shop , all within a secure environment which provides a sense of community .” It ’ s this sense of community that many South Africans are willing to pay a premium for . How this is achieved will differ from one
14 SEPTEMBER 2017 SA Real Estate Investor Magazine