Although there could be a long term upsurge in home buying after the World Cup, the short to mid-term reality could be that no increase in sales or prices will be seen for sometime, says Anton du Plessis, chief executive of Vineyard Estates.

“You often hear that the property market is cyclical and that recessions are inevitably followed by upturns. The fact that the market has followed this predictable formula over the last decade does not mean that it must continue to do so. It is quite possible for sales and price graphs to be L-shaped for prolonged periods and I believe this is what we are now experiencing at the Cape, and what we are probably likely to experience in the medium term.

“With property prices having tumbled across the globe, Cape property prices are no longer drastically undervalued in relation to overseas homes, particularly in light of the prices having more than doubled over the past six years. Some of the hitherto unheard of prices close to the R100 million mark currently being asked on the Atlantic Seaboard may actually put these homes higher than popular European holiday home destinations. There is simply no fundamental reason for a dramatic upturn.”

Du Plessis says the Cape residential property sector might well have to wait a further 12 to 18 months before there are any significant price increases and fast sales. This means that conditions favourable to buyers will continue to prevail for the foreseeable future.

“Buyers are today very different from those of 2004 to 2007. They are, a great deal more rational in their decision-making and far less inclined to be influenced by temporary enthusiasms.

“The market is, as always, driven by sentiment and dinner table and bar talk, but today this is far better informed than it was during the boom years. Right now many affluent buyers with resources are holding back and biding their time.”

Du Plessis says in Constantia, Bishopscourt, Claremont and Newlands, R324 million, R73 million, R61 million and R32 million worth of sales and transfers have been reported to date this year.

“This is a great deal higher than it was compared to the same period last year, but the well resourced buyers capable of spending R10 million or more who could easily make commitments if they wished are delaying in doing so if they don’t have to make the decision now. Buyers relocating from upcountry are still buying, but buyers contemplating eventual moves to the Cape seem to be biding their time, despite the availability of relatively excellent buys.”

Faced with this caution, he says, agents have to be able to back up their assertions with well-researched data on sales and price trends in their areas. This information must be printed and not simply given in a verbal form.

“Agents who can’t produce scientific comparative market analyses will risk losing a significant portion of their sales.”