Cape Town is experiencing a wave of “semi-gration”, as investors from other provinces seek greener and more stable pastures in the Western Cape.
Many semi-grants don’t fit the stereotype of affluent retired couples looking for a comfortable retirement in the Cape – they are young, well-resourced and ready to invest in the city’s commercial property sector.
If you’re considering making the move to Cape Town with the aim of relocating your business, there are a few things you’ll need to bear in mind before you sign an offer to purchase. Here are some must-know facts for semi-grants from other provinces.
Understanding the Cape Town property market
Cape Town is known for its uniqueness, and the commercial property market is no exception. Two of the biggest factors that make Cape Town’s property market different than those of other cities in South Africa are limited space for development and the general trend toward high prices.
The Mother City’s geographical position, nestled between mountain and sea, makes for very scenic living. It also means that the amount of land that’s suitable for development is just a fraction of the city’s total area – and unfortunately, this will never change.
Investors will need to accept higher price points for a similar type of commercial property they may have owned or rented in Gauteng and other provinces and factor this into their business strategies.
Knowing where to buy
Many semi-grants – especially those who are used to the large urban sprawl of Johannesburg – are often surprised by Cape Town’s urban layout.
- Property prices can fluctuate vastly from area to area – and the distance between high and low-end properties is often just a few kilometres.
- The Waterfront and Foreshore area appeal to many semi-grant investors, but property prices in the city’s most prestigious buildings may be out of reach for some buyers.
- Redevelopments are far more common than brand new developments in the Cape Town CBD and surrounding areas.
For these reasons, an area that is considered “up and coming” in Cape Town may not resemble the new and shiny corporate havens of Johannesburg’s New North, or the Umhlanga area in Durban – but they have great future growth potential.
Embracing diversity and investing in communities is essential
While some areas in Cape Town may not be uniformly modern and renovated, this hybrid quality is exactly what makes them unique and appealing. Business owners from other cities will need to assess the areas they are interested in buying premises and prepare to engage with the local community where many of their customers and staff members may be drawn from.
There are many other factors that investors from other provinces need to bear in mind when buying commercial property in Cape Town – including traffic congestion patterns, municipal rates, and investment yields – and understanding these requires expert advice.
For more information on investing in Cape Town and to view our hand-selected portfolio of commercial properties in the Mother City, contact us today.