Property Talk

Move to Ballito and live longer

Is Ballito set to become a suburb of Gauteng Semi-gration is the new buzzword as the floodgates have opened with people voting en-masse with their feet and relocating to the Western Cape and the North Coast of KZN, away from Johannesburg and Pretoria.

The Western Cape has the attraction of a professionally run Metro and the incredible beauty of the natural environment, but the eye-watering property prices are becoming harder to justify and the congestion has become a negative externality of its popularity.

The two hour commute from Cape Town to Johannesburg is far more inconvenient than the one hour flight between our King Shaka International Airport and JHB International. The proximity of the greater Ballito area to Gauteng and the relative value our property prices provide in comparison to the Western Cape, has resulted in a flood of families choosing Ballito as their destination of choice.

No longer a holiday village, Ballito is becoming a bustling area with investment in residential and commercial properties pouring in from both local as well as national developers. This trend is unlikely to stop any time soon. For those of us at the coal-face of property transactions, it feels like every second enquiry is from a family from Pretoria making the decision to migrate down here permanently.

Excellent schooling, limited congestion and traffic (for the time being) and access to world-class retail and lifestyle amenities are making for a very compelling case for a family to base themselves in Ballito and to commute to Gauteng on a weekly basis as may be required.

What does impact on aspirant migrators is the value of their properties in Gauteng. Whereas the Western Cape home prices are nothing short of intimidating, the greater Ballito home prices are still typically higher than the average prices our Gauteng neighbours are used to.

The recently published FNB Gauteng House Price Indices report provides detailed insight into the price performance across the extensive Gauteng area. The 3rd quarter 2017 figures show growth rates below the general economy wide consumer inflation.

Low nominal house price growth means negative real house price performance and this is evident when we look at the cumulative real house price decline since the 1st quarter of 2008 of these three metros with Tshwane's declining in real terms by -22.3%, Joburg by -24.25% and Ekurhuleni by -25.5%.

Those Gautengers who had sold up and moved to Cape Town or Ballito five years ago would have now ended up significantly better off as they would have bought in those markets at far lower pricing than available today.

This key 1st time buyer market that is strong in Gauteng is supporting the lower end of the market. Depressed macro-economics has taken its toll on the manufacturing-dependent Emfuleni Regions near the Vaal River.

The high-end residential market has been impacted on the low business and consumer confidence and the political uncertainty over the past year. For those families considering Ballito as their migration option, we say "Welcome!" with open arms. Move to Ballito and live longer.