Plett Property Market Review 2023-12-06
Average prices in Plettenberg Bay’s property market unexpectedly had another dramatic increase in 2023. A lot of 2023 sales will only register next year, but preliminary figures show average prices increased by 26%. This was after slowing to a 9% increase in 2022. However, sales volumes are down 50% and total value decreased by 37% though these will improve as more sales register in the months to come. Essentially prices increased as stock decreased, but the market slowed considerably in the second half of the year and stock levels are starting to recover. Plettenberg Bay normally follows behind the Gauteng property market by about 6 months, but in this property cycle Plett bucked the trend due to the big post-Covid-lockdown semigration and continued to climb during Gauteng’s downturn. With the busy summer season upon us, it will be interesting to see how things progress.
The average value for a property in Plett increased by 24% from 2020 to 2021 to R3million, a further 9% in 2022 to R3,3million and 26% to R4,2million in 2023.
2021 saw a massive increase of 92% in total value of property sold to R2,13billion, while 2022 was just below R2billion, and 2023 is at R1,2billion (so far). This is Plett’s third best year for total value.
The number of sales increased by 55% in 2021 to 705, then declined by 17% to 588 in 2022 and then a further 50% (so far) to 292 in 2023.
For full title property in 2021 there was a 31% increase in average value (R3,59million) in comparison to a 4,3% increase in sectional title averages (R1,82million). In 2022, sectional title averages increased by 27% to R2,32million and full title by 9% to R3,92million. So far in 2023, sectional title averages have increased by 16% to R2,69million and full title by 24% to R4,84million. Both are performing well with full title property taking the lead again.
Of particular interest is the number of full title sales below R1million decreased from 100 in 2022 to 28 (so far) in 2023. This is due to the decline in the stock of vacant land. Many plots were sold over the past few years and building activity is probably the highest it’s ever been. Building costs have also increased dramatically.
Buyer demographics remained stable. Most buyers normally come from Gauteng and Plett itself (±30% each), followed by Cape Town (±12%) and then international buyers (±8%). This year has seen locals outbuying Gauteng purchasers (±33% vs ±22%) and international buyers increased to ±16%.
Most estate agencies had record sales in 2021 and excellent sales in 2022 though down from 2021, and 2023 is down further but is still a good sales year.
The historical record price for residential property, which was previously in place since 2006 (R50million), was beaten by a R55million beachfront home on Beachy Head Drive in 2021 (the same house sold for R50million earlier in the year). Another notable recent sale is an Old Plett home above Look Out Beach for R38,350,000. In 2020 the highest price was R44million for a beachfront home in a gated estate on Robberg Beach. In 2021 there were 32 sales above R10million. In 2022 the highest price registered to date is R35million for a house on Central Beach in Bull Street. The highest value sales I am aware of in 2023 are R30million for an upmarket home in Old Plett and R33million for an older home on the beachfront in Beachy Head Drive. There is another considerably higher sale in 2023 but it has not registered yet.
Entry level asking prices in Plett have increased considerably over the past 4 years. It is difficult to find full title homes below R3,500,000. Sectional title unit prices start at R1,300,000. Vacant land starts at about R550,000 in gated estates and R800,000 in open areas.
Top current publicised asking prices for residential properties on the market are as follows: R57million for a house on Look Out Beach, R45million for a beachfront home on Robberg Beach, R27.5million for a large piece of land with development potential in the Cutty Sarke area, and R12,75million for a penthouse apartment in town. Top prices obviously fluctuate considerably depending on what is on the market at the time.
Historical property price increases over the past: 5 years: ±12.4%, 10 years: ±6.3%, 15 years: ±4.2%, 20 years: ±5.5%, and 25 years: ±11.5%. This demonstrates that timing of purchase has a significant impact on return on investment.
Hein Pretorius, owner broker of Sotheby’s International Realty Plettenberg Bay, says: “2021 was by far our best year to date. 2022 was our second best and 2023 is our third best. It was a good year, but the market cooled off in the second half. For the last 20 years we’ve had an oversupply of vacant land. These finally started selling out quickly over the past few years, which would have lowered the average sales prices. Now that there aren’t many stands left, it is mainly houses making up the sales and pushing the average prices up. House prices increased on average in 2023 but not as much as the inclusive increase of 24% indicates. I expect 2024 to be a challenging year, but we live in what is arguably the best place in Africa, so I look forward to the challenge.”
“High end properties are selling well and there are a few gems available. I just listed a seriously beautiful 732m² home on Signal Hill with magnificent views for R29million, and, in my opinion, it is one of the most beautiful homes in Plett.”
“It is a good time to sell as the market appears to be peaking, though demand is still high for correctly priced properties. For buyers, Plett remains popular and there is still limited stock, so if you see something you like act quickly or risk losing out.”
In the towns surrounding Plett there are normally very few sales, so statistics need to be seen in context and treated with some circumspection. Note that for these three towns, sales are taken by registration date, not sales date.
In Wittedrift eight properties registered for an average of R673,000 in 2020; in 2021, ten properties registered for an average of R1,146,000; in 2022, seven properties registered at an average of R1,283,000 and in 2023 to date five properties registered at an average of R1,656,000.
In Keurbooms proper (main town) 12 properties registered for an average of R5,8million in 2021(with two higher value properties of R14million and R15million pushing up the average); in 2022, 11 properties registered for an average of R3,75million, and in 2023, seven registered for an average of R7,1million.
Natures Valley saw averages of R4,6million in 2021 with six registered properties; in 2022, 8 properties registered for an average of R5,23million, and in 2023, 10 properties registered for an average of R4,9million. The highest price in 2023 was R12,5million for a house in Lagoon Drive.
The figures above were taken from deeds information on the 06th of December 2023. Sales for Plett are listed by date of sale, not transfer date, to provide a more accurate depiction of the market. Rural property, sales below R200 000, known non-market-related transactions and duplications (e.g., when a developer buys multiple properties for a single price and each is listed at the full price by the deeds office, only the single figure is taken), and outlying areas are not included in the figures. Many sales are still in the registration process, so the statistics and graphs for the later years, and last year in particular (2023), will change substantially in future. Other statistics are taken from Sotheby’s International Realty Plettenberg Bay’s figures.
This report was compiled by Steven Neufeld, Manager Principal of Lew Geffen Sotheby’s International Realty Plettenberg Bay and Professional Valuer and Court Appointed Appraiser for South African Property Valuations®: 072 417 7731 (or) steven@sapv.co.za
If you have questions send an email to: steven@sapv.co.za
