Book That Holiday And Buy A New Home
Data from Lightstone reveals that property sales in coastal towns are booming, with seaside properties in the Western Cape, Eastern Cape and the KwaZulu-Natal coastline showing considerable price increases in the past four years.
21/01/2025
If you have spent the December holidays in
popular coastal towns such as Scarborough,
Langebaan, Plettenberg Bay, Herold’s Bay or Salt
Rock, you may want to think about contacting the
local real estate agents to find out about
property prices.
“With interest rates
dropping and inflation at its lowest in recent
years, 2025 could well be the year to invest in
a second property as a holiday home,” says Bradd
Bendall, BetterBond’s National Head of Sales.
Data from Lightstone reveals that property
sales in coastal towns are booming, with seaside
properties in the Western Cape, Eastern Cape and
the KwaZulu-Natal coastline showing considerable
price increases in the past four years. While in
2019, 63% of sales in these areas were below R1
million, this dropped to 53% last year. This
shifting sales mix meant that homeowners paid on
average 25% more for their homes in 2023 than in
2019, reports Lightstone. “These price increases
underscore the increased demand for homes in
areas offering a relaxed lifestyle close to the
beach and other attractions.”
Given that
almost a million of the 6.8 million homeowners
in the country own more than one property, it’s
likely that many of the homes in these coastal
towns are being used as holiday accommodation,
notes Bendall. “These homes may either be used
by the owner or used to generate an income
through Airbnb or short-lease accommodation,”
says Bendall. This year, BetterBond granted
10,980 bonds for second homes. Most of these –
3,717 bonds – were for buyers between the age of
40 and 50, says Bendall. This was followed by
buyers in their thirties, who accounted for
3,057 of the second-home bonds.
While the
Western Cape was the top performer in terms of
BetterBond’s application volumes for second
homes, Johannesburg South East and Johannesburg
North West recorded the second and third highest
number of second-home bond applications. Greater
Pretoria is also a popular destination, with
1,694 applications. KwaZulu-Natal recorded 1,428
second-home bond applications this year, while
the Eastern Cape and Free State and Northern
Cape recorded 527 and 673 second-home
applications respectively.
The Western
Cape remains a premium holiday destination and
ideal investment market for second-home buyers.
This is underscored by BetterBond’s application
data for second homes which shows that the
lion’s share of applications (2,576) were in
this province. Lightstone data records a 6%
increase in sales volumes from 2019 to 2013,
with the average price difference for
transactions being 39% more.
The tranquil
suburbs of Noordhoek and Scarborough recorded
the highest average sales prices in the Western
Cape, according to Lightstone. “Noordhoek offers
a charming mix of country and coastal living
with properties on larger plots, surrounded by
stables and green belts. It also boasts
eco-estates where residents can swim, fish and
enjoy water sports in a secure setting.” Known
for its beaches and laid-back lifestyle,
Scarborough is an attractive holiday destination
just a short drive from Cape Town. It is perfect
for nature lovers looking for an escape from
urban living.
Just outside Cape Town,
Langebaan, St Helena Bay and Laaiplek recorded
the most transactions in the West Coast, reports
Lightstone. Offering a mix of properties at
competitive prices, these coastal towns are
popular options for second-home investments.
“Just a two-hour drive from Cape Town, these
seaside fishing villages appeal to weekend
visitors and holidaymakers looking for a rustic,
coastal escape.” Close to commercial hubs like
Saldanha, these towns have also become popular
with buyers moving to the region for contract
work.
According to Lightstone,
Plettenberg Bay is a sought-after destination
along the Garden Route, with average sales of
over R4 million. Herolds Bay on the Southern
Cape coast is also gaining in popularity, with
Lightstone reporting that house prices increased
from just under R2 million in 2019 to over R4
million in 2023. This family-friendly coastal
treat offers a range of property types, many
available in country estates.
“If you are
considering a second home in KwaZulu-Natal, a
spot along the south coast is a good bet,” says
Bendall. Lightstone’s data points to an average
price difference between 2019 and 2023 of 14% if
you exclude Durban from the measurement. Average
house prices in Salt Rock, for example, hit the
R4 million mark in 2023, up from around R3.3 in
2019. Home to some of KwaZulu-Natal’s most
pristine beaches, Salt Rock offers many
attractions that appeal to holidaymakers. It is
also close to two main highways and King Shaka
International Airport, making it a sought-after
destination.
“Of course, our coastal
towns also appeal to foreign buyers looking for
a well-priced second home. International estate
agent comparison site GetAgent revealed earlier
this year that Cape Town was in the top four
global locations to buy a second property, based
on annual online searches for second homes,”
adds Bendall.
“Whether you are looking
for a second home to enjoy with family or
friends on weekends, or a coastal gem that you
can let to local and international investors, be
sure to consider affordability before applying
for a bond. Consider the location of your second
home, its proximity to urban centres (for
shopping or entertainment) and security if the
property will stand empty for extended periods.
Coastal homes may require more maintenance
because of the sea air, so bear that in mind,”
concludes Bendall.