Stock shortages in the coastal region. The effect of semigration on the property market
Category Property
A growing number of South Africans who are able to work-from-home are opting to semigrate to the coast in pursuit of a better work-life balance.
Because of this trend, it might be difficult to buy property in the Garden Route right now, as the lure of a better quality of life is causing stock shortages.
Data from analytics group Lightstone Properties shows semigration, referring to people relocating within South Africa, has been gaining traction, with the number of homeowners relocating between 2018 and 2020 totalling 84,000.
The data shows that almost 12,000 homeowners left cities for smaller towns over the same three-year period. This may seem insignificant when thinking about the exodus from a big city, but this influx into towns is significant and will impact property stock, prices, and availability as we are now seeing in the Garden Route and particularly George.
Considered to be the administrative capital of the Southern Cape, George boasts state of the art infrastructure and a well-functioning municipality. Pair this with the ability to work from home and George all of a sudden seems like a beautiful, connected, safe and well-functioning place to live and work.
According to Bert and Lynette White, Meridian estate agents based in George and working along the Garden Route, one in five of their buyers are currently moving to George as they are able to work from home.
They noted that the majority of their buyers looking to permanently reside in George are from Gauteng, with an increasing number from Mpumalanga over the past three years, an increase in buyers from the Free State in the last two years, while buyers from Cape Town are rising in numbers too.
According to Property24 listing stats, there has been a decline of 22.86% year on year in the number of properties on the market - suggesting a growing shortage.
Bert and Lynette say that buyers want free-standing homes and those within estates. As a result, stock levels in these types of properties are running low, causing property prices in George and the surroundings to rise.
There are new developments on the cards, but the lag in availability is still causing prices to climb in the short term.
The move to smaller, better functioning towns aligns perfectly with the motivation behind semigration. This trend can only benefit smaller towns in terms of an influx of continuous income as opposed to spending by seasonal holidaymakers. The increase in demand for property and resultant lack of stock has already shown the knock-on effect of increasing property prices.
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This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your adviser for specific and detailed advice. Errors and omissions excepted (E&OE)
Author: Meridian Realty
