"The Northern Cape in general is buoyed by the strength of mining and agriculture and to a lesser extent, tourism, with benefits for all sectors of our regional economy," says Salvadore Buonadonna, area principal for Pam Golding Properties (PGP).
"However, among the key economic drivers of the city is a definite upswing in tourist volumes with positive news of a R50m project by mining conglomerate De Beer's to upgrade the 'Big Hole' as a tourist attraction, along with the construction of a R44m Protea Hotel adjacent to it," says Buonadonna.
In terms of the residential property market in Kimberley, Neumann says the highest activity is below the R500k mark despite the recent interest rate increases, with solid demand and steady sales volumes in the price range up to R850k and with the demand for homes to rent increasing by over 15% over last year.
"Capitalising on the burgeoning demand for residential rentals, Kimberley has seen a rapid increase in the number of home owners turning their garages and other outbuildings into bachelor pads which are snapped up by tenants who cannot afford to purchase their own homes. In this way these new landlords are able to utilise the additional income to supplement their bond repayments," says Buonadonna.
"Life is also being injected into the market with new residential developments in Hillcrest, Minerva Gardens and Royaldene. However, in sought-after areas in particular there are simply no vacant stands available for development and there remains a pent-up demand for sectional title developments and apartments.
"There is a general shortage of supply of affordable homes, particularly when one considers the influx of people as a result of the new hospital and R662m medium security, correctional service facility due to open later this year. This is coupled with a growing demand among black buyers entering the market," he says.
On the back of five years of dramatic house price growth, affordability rather than location is dictating where first-time home buyers and investors purchase residential properties in Kimberley. As a result, former "grey" areas are no longer being shunned but are growing in status and popularity among those with limited spending power.
Buonadonna adds that rising commercial activity has contributed to the escalation in entry-level house prices, which we currently estimate at around R500k. For this price tag, buyers will qualify for a small, old-style home with wooden floors and attractive pressed ceilings situated on a stand of up to 1,000sq m. Homes such as these, which generally require renovation, tend to be found in suburbs such as Kimberley North, De Beers and West End.
The diamond city's growing economy has also boosted prices at the top end of the market, where it is no longer uncommon to find homes with price tags of R3m and more. For example, to acquire an immaculate, original Victorian house on a stand of approximately 2,000sq m one can expect to pay around R3m. Unheard of a few years ago, these top end prices are now well within reach - and being paid - by executives hailing from the diamond and other industries.
Those with high affordability tend to head for the Memorial Road area, in particular the streets of Carrington Way and Milner Street, which are within walking distance of the private Christian Brothers College. At present, however, house prices still offer value for money - with sound investment potential - ranging mainly from approximately R350k to R1,5m - with house price growth over the past two years averaging at approximately 14% per annum.
Kimberley's rapid transition into a major commercial hub in the province has also seen demand for business premises escalate, a factor which has further affected former residential suburbs and stock levels as homes are now rapidly being converted into offices as demand for rental space outstrips supply.
For more information contact Salvadore Buonadonna on 082 555 1516 or send an email.
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