Is the CT property bubble bursting?

shooter69

shooter69

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Ok so I saw this article below saying the CT property rental bubble have burst.

https://www.privateproperty.co.za/a...ns-the-cape-town-rental-bubble-has-burst/6421

Then I also found this ad which made me think of the 2007 property crash in the US.

https://www.gumtree.co.za/a-houses-...t-5-available-units/1002417525980911137580809

So basically in the US people were offered stuff to make a sale. Lets say a car with your purchase of a property ect. The ad above is giving you R50k Makro voucher.

This got me thinking..... would you give away a R50k Makro voucher if your properties were selling like hot cakes?

Is the CT property bubble actually bursting?
 
terencej said:
Ok so I saw this article below saying the CT property rental bubble have burst.

https://www.privateproperty.co.za/a...ns-the-cape-town-rental-bubble-has-burst/6421

Then I also found this ad which made me think of the 2007 property crash in the US.

https://www.gumtree.co.za/a-houses-...t-5-available-units/1002417525980911137580809

So basically in the US people were offered stuff to make a sale. Lets say a car with your purchase of a property ect. The ad above is giving you R50k Makro voucher.

This got me thinking..... would you give away a R50k Makro voucher if your properties were selling like hot cakes?

Is the CT property bubble actually bursting?
Click to expand...

They trying to sell buh rein estate at a premium, its still just "kraaifontein". They keep on promising residents a shopping mall etc, that still has not been build also.

Bubble is slowing bursting for area far from CBD, CBD is still doing pretty well.
 
terencej said:
Ok so I saw this article below saying the CT property rental bubble have burst.

https://www.privateproperty.co.za/a...ns-the-cape-town-rental-bubble-has-burst/6421

Is the CT property bubble actually bursting?
Click to expand...

I own a flat in the Northern Suburbs and rent it out. The agent I use recently told me that more and more people are simply not able to afford CT rentals in most areas and it is forcing landlords to drop the rental prices. The agent might be feeding me a bunch of BS, but I can kind of believe it with the ridiculous rental prices in some areas.
 
Last edited:
I had to renew my lease last week, the agent told me the owner does not want him to increase the rent.
 
terencej said:
Then I also found this ad which made me think of the 2007 property crash in the US.

https://www.gumtree.co.za/a-houses-...t-5-available-units/1002417525980911137580809
Click to expand...

I don't think so, shopping around for a place for my folks now after buying my own house two years ago the properties in the same areas are up by an easy 30-40% from when I bought.

Buh-Rein is an outlier of perpetually struggling to make sales so as GTX said I think it's a unique thing and not indicative of the market.

I would believe though that the rental market outside of the property one itself is taking a bit of a dip and rightfully so.
 
We bought a flat out near Tygervalley three years ago.... for 1.25 ... three years later we were offered 1.75 for it.... Besides the rental we got every month the property increased in value by 13 000 a month.... crazy! never expected that....

I see every couple of months articles appear saying that the CPT property market is faltering..... I think not....
 
House sales are not slowing, but there is a definite over-supply of rental units. I know well two rental agents. In the southern suburbs from Claremont to Muizenberg, they were lucky to have 10 units available. Now there are 40.

They attribute it to people trying to get rich quick on AirBnB. This time of the year, two or three months can go by with no enquiries and you cannot simply make up the slack in summer
 
terencej said:
Ok so I saw this article below saying the CT property rental bubble have burst.

https://www.privateproperty.co.za/a...ns-the-cape-town-rental-bubble-has-burst/6421

Then I also found this ad which made me think of the 2007 property crash in the US.

https://www.gumtree.co.za/a-houses-...t-5-available-units/1002417525980911137580809

So basically in the US people were offered stuff to make a sale. Lets say a car with your purchase of a property ect. The ad above is giving you R50k Makro voucher.

This got me thinking..... would you give away a R50k Makro voucher if your properties were selling like hot cakes?

Is the CT property bubble actually bursting?
Click to expand...

Balwin properties have been giving away cars for quite some time (you get entered into a draw). This is in JHB too.
 
Don't throw the word bubble around to loosely it's the top of a normal market cycle but nothing near a bubble.
 
Honey Badger said:
I had to renew my lease last week, the agent told me the owner does not want him to increase the rent.
Click to expand...

In years of plenty I will raise the rent by 10% - 12%. But since 2008 it is never more than 6% - 8% and I make sure to do some work (paint job, new kitchen) as an incentive and to always attend to complaint and problems straight away

At the last house showing I had, there were two separate sets of "priests" from some African Evangelical Church who came along who insisted I give them preference. Alas, both failed a credit check badly. The one set had two sequrestations
 
Mortymoose said:
We bought a flat out near Tygervalley three years ago.... for 1.25 ... three years later we were offered 1.75 for it.... Besides the rental we got every month the property increased in value by 13 000 a month.... crazy! never expected that....

I see every couple of months articles appear saying that the CPT property market is faltering..... I think not....
Click to expand...

This sounds a lot like the story a close friend told me a year or so ago. Bought flat for R900k in durbanville. Told me agents offered him 1.9mil last year.

Heres the thing. He put it in the market last month and they told him he will not get R1.9 mil for the property.

Again, quick look on property24 and you can find apartments from R1.2 mil there going to R2.1. You probably have one of those waterfront facing flats?
 
On property value - I've still experienced decent growth in the past year.

I'm selling after some above-average growth but not expecting anything below national average growth in Cape Town property prices.

Just a feeling that I won't get much more out of hanging on to the properties and the small amounts are no longer worth my time.

On rental - it just seemed impossible to raise my rental to the average - so definitely landlords have been milking it big time.
 
I also think property here in CPT is overpriced. It is a pricing strategy if everyone just assumes that tenants can afford a 10% increase each year in rent. I don't think that a an annual escalation should be included in any rent contract as standard, tenants should always request it be removed.
 
I've noticed a really big increase in "For Sale" signs in the CBD and surrounds, and some have been there for a while. Not sure what this means or if it means anything, just something we commented on a couple weeks ago
 
Could the expropriation without compensation BS be triggering slower sales as a whole?
 
I've been looking at flats in the Cape Town City Bowl. Two identical flats in the same block and same view in Vredehoek sells for R1.3m and rents for R6,500. That's only 50% if you have a 100% bond.

I certainly won't buy a flat after seeing this. Renting is much cheaper. And sounds like it's going to get even cheaper.
 
I haven't increased my rental for the last 3 years - even the tenant told me it's ok to increase!

But - I'll rather keep a good tennant with this kind of incentive.
 
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