FOURWAYS MALL EFFECT ON THE RESIDENTIAL MARKET
The largest shopping centre in South Africa has recently opened its doors. Fourways Mall boasts a total of 450 shops and covers an astounding 178,000m². This new development is set to be a huge drawcard for the area which in turn will undoubtably influence the values of homes in the surrounding suburbs.
According to Regional Director and CEO of RE/MAX of Southern Africa, Adrian Goslett, developments of this kind can bolster property values over time. “Demand will drive prices up as the area grows in popularity. Savvy investors will get into this market early to get ahead of the price curve,” says Goslett.
Seconding this opinion is area expert, Abby Goodford, Broker/Owner of RE/MAX One Hundred. “This kind of development can only bode well for the suburb. This new mall means that whatever you need will be right at your doorstep, creating a true work, live, play lifestyle for all who choose to live in Fourways. It is definitely a buyers’ market right now and I would urge investors to look our side, keeping in mind that the mall will have an effect on the surrounding residential market but, as with most things, it will take time. The commercial office blocks will attract an influx of new tenants and buyers but we are still some time away for that,” Goodford explains.
As things stand, there has been a lot of new complexes as developers have been anticipating an increase in demand. However, Goodford explains that this has caused a current over supply and tenants have a very healthy choice available to them. “Because of this, tenants expect to pay less on their rental and many landlords are finding it difficult to come to terms with the lower rental returns. Sellers in our area similarly think that they will get an instant appreciation in price, but the rules of supply and demand are still in play,” she clarifies.
Consequently, Goodford describes that in areas such as Lonehill, Paulshof and Magalliesig, landlords can expect R6,500 – R7,500 in rent for a 1-bed apartments, a 2-bed apartment or townhouse will rent for around R7,500 – R8,000, and a full title home will rent for R13,000 upward. “For those looking to buy, a 1-bedroom apartment sells for around R760,000 and buyers could get away with less than R 2 million for a 3-bedroom cluster home. For a free-standing property in Waterford Estate, this amount rises to up to R5 million,” says Goodford.
The market does currently favour buyers and tenants thanks to the influx of new properties that have become available, but this will change in due time as the area increases in popularity. “Investors should therefore watch this area closely to make sure they do not miss out on an opportunity while the market is in their favour,” Goslett concludes.