"Generally, sectional title units are cheaper than freehold homes, and they are now attracting many potential buyers who are too cash-strapped to qualify for a loan on a house. Security considerations are also coming into play as most sectional title units are located in gated complexes and another attraction, especially for first-time buyers, is that there is no transfer duty payable on new sectional title units," says Lew Geffen, chairman of Sotheby's International Realty in SA.
According to the Gauteng Property Price Indicator (GPPI) produced annually by Lew Geffen Sotheby's International Realty, the number of sectional title sales has grown by between 7% and 9% in most parts of the Johannesburg metro over the past 12 months, except for the pricey northern sector, where sales have fallen.
Meanwhile, the total value of sectional title sales has risen in the eastern and northern suburbs, while declining somewhat in the central areas and falling sharply in the western suburbs, where an oversupply of flats and townhouses developed during the boom years and many overcommitted buy-to-let investors are now dumping their units, says Geffen.
The GPPI, which is compiled using Deeds Office figures, shows that the best ST sales performers in the eastern suburbs were Berea, Yeoville, Edenglen, Bellevue and Bedford Gardens, where hundreds of sales took place over the past 12 months.
The areas that recorded the biggest price improvements year-on-year were Berea, with a 176% improvement in the average ST sale price, Yeoville (74%) and Bellvue (61%).
Of the central suburbs, Northcliff, Killarney, Parktown North and Linden were the areas where the most sectional title units were sold over the past 12 months, and the highest average price increases were recorded in Greenside (162%), Northcliff (109%) and Linden (96%).
To the north, the highest numbers of ST sales took place in Sandown, Morningside, Bryanston, Buccleuch and Douglasdale, and several areas still managed to record year-on-year (y-o-y) increases in average prices despite the overall decline in sales volumes. These included Morningside (55%), Bryanston (48%) and Benmore Gardens (37%).
In the western suburbs, sales volumes have climbed in response to rising stock levels and declining prices, and many hundreds of units have been sold over the past year in areas such as Ferndale, Weltevreden Park, Wilgeheuwel, Sundowner and Windsor. Suburbs where prices did manage to achieve a y-o-y increase were Kensington B, Horizon View, Helderkruin, Florida Glen and Berario.
For more information contact Lew Geffen on 011 886 8070.
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