28 Jul 20

3 TOP investment locations in SA

It’s evident, now more than ever, that property is by far the key to wealth creation. With the lowest interest rate South Africa has seen in almost 50 years, buying property right now is even more appealing. The objective when property hunting is to identify the best area that will generate better capital appreciation over time. Therefore, we will be taking a look at 3 top areas across the country that you should consider looking into.

“When seeking a successful investment opportunity, you want to zone into a new growing node which will be undoubtedly successful. The key is location, with existing or planned attractive amenities (Education, Medical & Retail). These areas should be at early booming stages, largely undeveloped, where the competition is still low. Tapping into these residential developments will give you the highest return on your investment from a long-term perspective”, explains Kristy Davidson, Head of Research at Rainmaker Marketing.

Take a look at the 3 top areas our team has identified:

1.KZN North Coast

We’re not being biased here, we promise. Not only did AfriAsia Bank’s SA Wealth Report in 2019 indicated that the Durban-Umhlanga-Ballito corridor is the fastest growing wealth market in SA, with 25% growth trajectory reported over last decade. Between the years of 2016 and 2019, Ballito and Salt Rock towns have experienced an average sectional title price growth of 6% and 7% per annum, respectively. Over the same period, Simbithi Eco Estate has seen the same increase of 6%. Areas such as the Sibaya Coastal Precinct are setting a new precedent in the property market within this region, with first investors seeing as much as 40% capital appreciation in their properties, within less than 5 years. This is a must for property investors and future first-time homeowners.

2. Midrand

Midrand has become a key growth node with affordable property that continues to see year-on-year growth. The area is centrally located between Johannesburg and Pretoria. It also has easy access to the N1 and public transport like the Gautrain, the Mall of Africa, along with key business nodes. Comparing population increases, Sandton has increased by 25 250 adults between 2011 – 2019, whereas Midrand has seen a significant spike, with 214 231 new adults over the same period. From 2016 – 2019, median sectional title prices within Midrand increased by 8,5% (comparing to Sandton at 2,6%). Additionally, the total number of sectional title registrations within this timeframe increased by 38% (with Sandton experiencing 25% less transfers).

3. Rosebank

Another area to look out for is Rosebank in Johannesburg. Within a 13km radius of Rosebank, you will find Dunkeld, Parktown North, and Melrose. This area is seeing many mixed-use developments and urban rejuvenation pick up. It has a high rental demand with 61% of apartment properties leased. As a result, the area is attracting a younger market, with 30% of recent buyers between 18 – 34 years of age. The area is made up of largely sectional title opportunities (92%), and of the greater area Rosebank still sees a higher amount of sectional title property transfers.

There is so much more when looking into locations, from proximity to price point. Before taking advantage of the current interest rate, and getting your foothold on the property ladder, do your homework into the area you are looking into.