Childhood memories of wonderful holidays as well as more recent vacations appear to impact property sales at the coast and other leisure destinations.
The easiest way to verify what a true market related price would be in an area you may be unfamiliar with, is to get a property valuation report, which will give you what similar properties have actually sold for.
So says Adrian Goslett, the CEO of RE/MAX of Southern Africa, and adds that while it is often assumed these areas enjoy good sales during the holiday season, the majority of transactions tend to occur in February and March, once visitors have returned home.
“Very often the last thing on people’s minds when they go on holiday is investing in property” he says. “However, once they return home, the idea of owning a holiday home or even moving to the area permanently becomes more appealing.”
Goslett warns that as with any property purchase, investors should do their homework before investing. “There are a number of dangers associated with buying property sight unseen, and buyers should treat the purchase of a second home in much the same way as they would their primary residence.”
He recommends using a local agent who is familiar with the market conditions in the area and says that overpricing is a reality at the moment, and buyers need to ensure that they are getting good value for money.
For anyone wishing to a buy a property in an area they may not be that familiar with, it may be difficult to know 'what’s a fair price to pay'. Buyers should follow these steps in determining what price to offer for a property:
- Talk to various local estate agents to get an idea of what similar homes in the area are priced at and whether these prices are realistic or have been inflated by hopeful sellers.
- Look through the local property newspapers, brochures, etc.
- Search property websites to determine the prices of similar homes.
- The best way to verify what a true market related price would be, is to get a property valuation report, which will give you what similar properties in the street, suburb or complex have actually sold for. This way you can be confident that you will be making an offer at a fair and realistic price.
Another factor that Goslett says buyers need to consider is whether the property will satisfy all their needs. “Buying a well-priced property that is kilometres from the beach may seem like a good idea at the time, but buyers with families need to remember that the children will need to be ferried to the seaside more than once a day and driving through holiday traffic during peak periods can be frustrating.”
He also says that anyone investing in a coastal property, particularly a freestanding home needs to consider maintenance costs. “Because of the sea air, coastal properties, particularly those situated close to the beach require far more maintenance than inland homes. Security is also a major concern for those who leave a property unattended for the best part of the year. It is for this reason, he says, that the lock-up-and-go option is often the more popular choice in this segment of the market.
Goslett says that, generally speaking, coastal areas bore the brunt of the property slowdown and therefore, in certain areas at least, there are still some property bargains to be found. He warns, however, that this situation will not last and anyone who is considering entering the second home market should do so sooner rather than later.
Owners who choose to lease out the property should take as much care with their letting agent as they did with the agency who sold them the property in the first place.
“Absentee landlords have to be extra vigilant when choosing a letting agent for a holiday home.”
Goslett recommends choosing an agent who has a good reputation in the area, has a large variety of holiday accommodation on their books, an in-house cleaning and maintenance team as well as a valid Fidelity Fund certificate.
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