The property market in Hermanus is currently a “buyers market” with property prices well below the market value.
Paul Kruger from Seeff says the current property market is very much a buyers market. “We are seeing more sellers than buyers and these buyers can expect offers between 14% and 20% less than the normal market value. This is the best time in many years to buy property in Hermanus,” he says. Kruger explains that in Hermanus full unit sales saw a high number of 886 sales in 2018, which is the highest it has been since 2010. In 2019 they are projecting a number of 587 unit sales, a serious decline from the previous year.
According to John Leppan, principal of Hermanus Property, the Hermanus property market hasn’t escaped the mood of South Africa or the hangover of South Africa. “After the crash in 2008 the property market limped along up until 2012 whereupon we started to see both a recovery in the volume of trade and value. This growth remained constant for the next four years with a notable increase in 2018 reaching a record trade of freehold properties with 886 homes being sold.”
Leppan says things changed this year and by the end of the third quarter of 2019 there had been a steady decline in freehold sales with only 339 homes being sold. “If one takes into account that there is one more quarter left, it is safe to say that there will be a reduction of over 50% of units sold in 2019 as opposed to the year prior.” Hermanus Beach Club Estate Manager Marius van der Westhuizen says that the 2018 protest has had a negative affect on the short-term rentals. “We have also lost long-term tenants in units directly opposite the informal settlement, but this has not affected the balance of the estate,” he said.
But Leppan says during the course of 2019 there has been infrastructural improvements in the greater part of Hermanus including fibre, education and medical facilities. “We definitely remain a region which continues to set a very high standard and is most notable when compared to other areas in our country.
Furthermore, the hospitality industry is reporting double digit growth which certainly bodes well for our local economy. Our December and January school holidays are 14 days longer this year which too should give us the needed injection.”
Leppan says that it is without question that Hermanus is experiencing a buyers market and those who are brave enough to commit will enjoy the returns seen by investors who purchased properties through 2009 and 2010.
“The old adage in property is to do the opposite, buy when people are selling and sell when people are buying.
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