Across the market, residential property sales in Bloemfontein during 2020 were the highest recorded for the past decade, despite the impact of Covid-19 and the lockdown.
While pent-up demand due to the hard lockdown and the prevailing low-interest rates have had an impact, a high volume of listings in the area together with an increased sales force at the start of last year have also contributed to the performance according to Sirgel.
“The low-interest rates also prompted many tenants to decide to acquire their first homes as they realised they could afford a property similar to their rental property, and with banks awarding up to 105% loans.
‘50% of sales to first-time homebuyers’
“In line with this, we are also seeing considerably more younger homebuyers in the age group from 23 to 35 years – many being first-time purchasers, as well as buyers up to 40 years of age and over. In fact, about 50% of our sales are to first-time homebuyers.
“Notably, while two-thirds of housing stock is freehold, significantly more sectional title units are sold each year, as evidenced by Lightstone statistics which reveal that 1 984 sectional title units sold in 2020 compared with 1 246 freehold sales, which is probably due to affordability and security factors.”
Sirgel says the demand for homes priced from R200 000 up to R1.8 million continues unabated, with properties priced right selling rapidly, and with competing buyers pushing up prices in some instances by 5-10% over the asking price. A sectional title unit offered at a fair market price can sell in just days of listing.
There are currently *672 new property listings in Bloemfontein market, according to Property24 Trends Data, with the average asking price for the area being R1.299 million. The average sale price per erf for 2020 was about R940 000, while Section Scheme Units average sale price for the same period is R750 000.
The latest residential listings on Property24 show that three-bedroom homes are most widely available, at an average list price of R1 277 500, while two-bedroom homes currently in demand are being sold at an average of R750 000. Sellers in the area fall within the 36-49 years (34%), while buyers in the 18-35 fall in (39%) – followed by 38% within 36-49-year age group.
Click here to see all the latest trend data for Bloemfontein
“There is good value to be had at present, with bachelor flats priced between R290 000 and R430 000 and duets selling from approximately R1.3 million. Sectional title units typically sell from around R600 000 to R1.3 million or R1.4 million for your more spacious, luxury two and three bedrooms. At the brand-new residential development, La Vida Pico in Langenhoven Park, we have sold a number of two-bedroom, two-bathroom sectional title units from R1.62 million, with three-bedroom units priced at R2.3 million.
“Other areas popular among sectional title buyers include Heuwelsig, Pentagon Park and Helicon Heights. Such is the demand for sectional title that we are seeing owners and investors developing and building sectional title duets and townhouses on a portion of rezoned freehold land. There are definitely opportunities for developers with a vision to bring new sectional title stock to market to cater for the high demand, especially for smaller investment properties, typically one-bedroom and two-bedroom units for a young first-time home-owner into their first year of work.”
Sirgel adds that the demand is across all areas, including the outskirts of Bloemfontein and particularly for smaller, accessibly-priced three-bedroom houses with a carport and garage in the price band from R700 000 to R1.2 million.
“Generally, the market from R2.5 million to R4.5 million has been very active since June last year. Student accommodation is also sought after, albeit at a slightly slower pace than previously, with investors favoring two or three-bedroom sectional title units located around the University of the Free State in the suburb of Universitas, where they are enjoying very sound rental returns of 9-11%.
“At the top end, from R2.5 million and R3 million up to R6 million or R7 million, there is also a good movement of stock. Freehold homes are typically sought by young families in the 30-35/38 age group with small children who need extra space, including a garden where you can kick a ball, increasingly so since the lockdown. In this market, the areas of Woodlands, Waverley and Uitsig are very popular.”
“While we have a good selection of homes to buy, we are currently experiencing a shortage of stock for sectional title units from R980 000 to R1.6 million. The rentals market remains active, with good occupancy, particularly among young couples starting out,” says Sirgel.
Want all the latest property news and curated hot property listings sent directly to your inbox? Register for Property24’s Hot Properties, Lifestyle and Weekly Property Trends newsletters or follow us on Twitter, Instagram or Facebook.
*Property24 Listings Data Disclaimer: The trends detailed in this article are based on Property24 listings, current at the time of publishing, and property transfer data supplied by Deeds offices, which typically take 3-4 months to reflect. Suburbs are listed according to Property24’s geographical database. In some areas this will include both commercial and residential properties. The age demographic data of buyers, sellers and stable owners is determined over a six-month period. These Property Values should not be used as a substitute for independent professional advice and is subject to Property24.com Terms and Conditions.