Africans are investing in Africa

Africans are investing in Africa

Artist’s impression of a home in Signature Sibaya on the KZN North Coast, which is popular with Nigerian buyers who are interested in secure estates near the coast.

While the number of international buyers in residential property in South Africa remains relatively low, at about 3% nationally, investors from elsewhere on the continent – including returning expatriates – are still keen on buying property in SA for a variety of reasons.

These include countries such as Zimbabwe, Zambia, Namibia, Nigeria, Botswana, Kenya, Angola, Moçambique, Angola, DRC, Ghana and Gabon.

“The price range mostly in demand is from R800 000 to about R5 million, with some enquiries and transactions up to R10m and beyond,” says Dr Andrew Golding, chief executive of the Pam Golding Property group.

“Many investors are businesspeople, including entrepreneurs, either travelling regularly to SA on business or establishing bases from which to expand their operations, not only in SA but also in other African countries.

“As they may spend considerable time in the country it makes financial sense to buy a home here, a trend which is particularly evident in Gauteng in areas such as Fourways, Sandton, Sandhurst, Hyde Park and Houghton.

“Others with children attending schools and universities here look to buy homes where they can stay when visiting during holidays, or buy well-positioned apartments as student accommodation for their adult children, coupling as a sound investment.”

Golding says some investors look for getaway holiday homes in highly desirable locations, such as Cape Town’s Atlantic seaboard, southern suburbs and the Blouberg area. Other popular areas are the Boland and Overberg regions, such as Stellenbosch and Somerset West or Hermanus, Kleinmond and Onrus; or the Garden Route, for use by immediate family for short or extended periods during the year.

With sound long term investment an important factor, as well as convenience and centrality of location, brand new, secure residential developments and gated lifestyle estates in areas such as Johannesburg – notably Dainfern in Fourways and nearby Blair Atholl, or suburbs like Illovo, Inanda and Kelvin which are close to Sandton CBD and business hub and OR Tambo International Airport – and Pretoria are in demand.

“We see a large number of buyers from Africa investing in our new developments,” says Retha Schutte, Pam Golding Properties regional executive in Pretoria. “As they tend to spend a number of days a month here on business, they look mainly at furnished apartments that are suitable for short term rentals. This gives them the opportunity to stay in the apartment for a few days a month and then put the apartment back in the rental pool.

“A recently launched new development, the Regency in Menlyn Maine, is a good example. It’s a sectional title apartment building with a concierge desk, a pool deck and a restaurant, giving it the advantages, look and feel of a hotel. This development is close to shopping and entertainment amenities and a casino, and there is a shuttle service to the nearest Gautrain station. Generally these buyers look for properties in the R1m to R3m price range. Over and above this investment, they also contribute to the local economy as they grow their businesses in the country.”

In Fourways, a soon-to-be launched new development, Dainfern Square luxury apartments, will appeal to local buyers as well as those from the rest of the continent, says Kyle Ebben, area manager for Pam Golding Properties Fourways office.

“At the leading edge of Johannesburg’s ongoing expansion into the ‘new north’, this is set to become one of the most desirable addresses in the city. It’s close to major transport points like William Nicol Drive, Lanseria Airport and the Gautrain bus service, right next door to Dainfern Square shopping centre and amenities in the vicinity include medical facilities, eateries and a gym.”

The two-bedroom apartments are priced from R1.75m to R3.85m.

Other buyers, particularly those from Zimbabwe, look for residential property in Gauteng and the Western Cape as well as coastal holiday and retirement homes in KwaZulu-Natal – with its temperate year-round climate, or lock-up-and-go homes in areas where their children attend private schools or university, such as Grahamstown in the Eastern Cape.

In KZN Carol Reynolds, Pam Golding Properties area principal for Durban Coastal, says new developments like Signature Sibaya on the north coast have piqued the interest of buyers from Nigeria.

“Most are interested in secure estates near the coast. They travel in Africa and want a base here in KZN – a holiday home to double up as a base for business meetings. They look at the upper end of the market and security is paramount.”

Moçambiquan buyers on the other hand are drawn to property in towns such as Nelspruit, Komatipoort and Malelane, mainly as a result of cross-border trade between the two countries or Moçambiquans who live in SA where their children attend schools, and who commute to places of work over the border.

Kunaal Samani, Pam Golding Properties managing director in Kenya says: “Many Kenyans have children in schools and universities in South Africa, and the most attractive locations are Cape Town and Johannesburg for investment and diversification of their real estate portfolios – Cape Town mainly for leisure and second homes, and a retirement plan, and Johannesburg for rental income generation.”