Luxury home buyers shift to Hout Bay, prices up by 140% in 5 years

Hout Bay is fast becoming the new luxury hub on the Atlantic Seaboard, experiencing a notable surge in high-end buyers in recent years. Stephan Cross, manager for Seeff Hout Bay, reports that despite a broader market slowdown, properties are selling at the fastest rate in over a decade amidst constrained supply, with almost half of all sellers achieving close to or even their full asking price, and in some instances above their asking prices.

Average prices have escalated by about 141% over the last five years, with both the sales and rental markets in high demand. Recently a rental was recorded with a record of R250,000 per month for a super luxury home in the Kerzner Estate.

Propstats data shows the average transaction price for Hout Bay stands at around R8.5m, up 54% on last year’s R5.5m due to a higher volume of top-tier sales. Five years ago, less than 2% of sales exceeded R10m. This year, about 22% of sales are over R10m, and several transactions top R20m, primarily in the estates. Only about 40% of sales are now below R5m, mostly apartments and sectional title units.

Cross says five years ago, sellers were achieving on average 10% below their asking prices and properties spent as much as 175 days on the market. That timeline is now down to just over one month, twice as fast as last year’s average of 78 days. Sellers are now achieving around 3.9% below asking prices, with almost half achieving at or near full price.

Beyond its scenic coastal appeal, Hout Bay offers ideal suburban and estate living and a great alternative to the Atlantic Seaboard. Cross notes a steady influx of semigration buyers from Gauteng and KwaZulu-Natal, alongside international purchasers predominantly from Germany and the UK, as well as buyers seeking Airbnb investments.

Gated estates are a primary drawcard for luxury buyers. Ruyterplaats now boasts a median price of R18.75m, with several sales over R20m over the last two years. The median price for Kenrock stands at R17.9m, with most sales now over R10m to over R20m.

New developments around Hout Bay, including boutique estates and luxury apartments, continue to expand the area’s property offering, he says further. The growth of the ultra-luxury Kerzner Estate, with its bespoke architectural homes, has further elevated the local market into the super-luxury category.

The estate has significantly raised the benchmark for property values, as demonstrated by the record R250,000 monthly rental. Notably, Cross mentions that the architect and developers behind that residence are already working on their next project, House 23, which is being marketed off-plan at R43m (including VAT) for occupation by the last quarter of next year.

In conclusion, Cross highlights that Hout Bay offers a complete lifestyle package, combining scenery, an active beach, and a cosmopolitan culture with water sports, hiking, cycling, horseback riding, top-tier schools, and local amenities.

Issued by Gina Meintjes