SA tourism: More people look to buy holiday homes, especially in these coastal towns

As a ‘new normal’ cements itself in the post-Covid world and tourism edges closer to pre-pandemic levels, more South Africans are starting to invest in holiday homes.

While this trend is, of course, generally reserved for more affluent buyers, ordinary homeowners are beginning to realise the invest potential that second homes offer.

After all, not only can these properties be used for personal holiday purposes but they can generate short-term rental incomes when not in use.

The enduring resilience of the South African tourism industry continues to make holiday homes a solid and attractive investment option for discerning buyers, says Jay Azran, managing director at Royal Jozini – an estate situated within a private game reserve in eSwatini on the border to South Africa that caters to holiday home investors.

There are several “compelling benefits” of investing in a holiday home, including financial returns, convenience, and a memorable vacation experience.

“A distinct advantage of owning a holiday home is the convenience it offers when you decide to travel or enjoy a family vacation. There is no hassle of researching, planning, and booking each time you want to take a break. Your holiday home is readily available and designed to your liking.”

Serving both as a personal retreat and an income-generating asset, he says investment in these properties is an enticing choice for those who yearn for both relaxation and a robust return on investment, providing buyers with a secondary source of income. This rental income is one of the most appealing aspects of owning a holiday home.

“Your property can generate revenue when you’re not using it, helping offset additional costs such as levies and utilities while enhancing your overall return on investment.”

Yael Geffen, chief executive of Lew Geffen Sotheby’s International Realty, says the allure of rural retreats and second homes is on the rise as individuals seek escapes from urban congestion – and to diversify their property portfolios.

“The desire for tranquillity, outdoor amenities, and spacious properties is driving demand for homes in rural and vacation destinations. This trend is fuelled by a shift in priorities and a re-evaluation of lifestyle choices.”

With tourism back in full swing and demand for holiday rentals on Airbnb and back to pre-pandemic levels, the Seeff Property Group reports that demand for homes in Western Cape coastal towns has grown enormously over the past two years. Despite a slower sales market, homes in holiday towns have, for example, still sold for over R10 million and up to R33m in Plettenberg Bay.

Aside from the semigration trend to the coast boosting demand for coastal homes, the agency notes that people who want to remain in other economic centres such as Gauteng have a strong desire to own a second home here.

There has also been growing demand for Eastern Cape coastal hotspots which often offer more accessible pricing compared to that of the Western Cape.

Seeff agents highlight some of the top holiday home hotspots – and what you can expect to pay for properties:

1. Clifton and Camps Bay – Cape Towns’ Atlantic Seaboard

These are the two hottest holiday home hotspots for wealthy buyers, says Ross Levin, licensee for Seeff Atlantic Seaboard. Based on this year’s sales Clifton boasts an average house price of more than R50 million, and an average apartment price of more than R22m.

Camps Bay recorded the highest volume of sales above R20 million this year.

“With a fabulous cosmopolitan lifestyle, scenic setting between the mountains and white, sandy, beautiful blue flag beaches, these areas are the top holiday home hotspots attracting wealthy buyers along with visitors, celebrities, and Instagrammers.”

2. Plettenberg Bay and Knysna – Garden Route

Despite a challenging year, Seeff Plettenberg Bay still achieved sales ranging from R17.3m to R33m – some of the highest prices paid outside of the Atlantic Seaboard. Alet Ollemans, licensee for Seeff says the “fabulous climate” and cosmopolitan beach lifestyle is a big drawcard.

You can still find well-priced apartments in Plett from around R1.4m, but luxury units range from about R6.5m to R12.75m. Houses range from R2m to R4 million on average, but luxury homes can be priced as high as R60m.

“Knysna waterfront properties in Thesen Islands have enjoyed fabulous sales over the last few years as buyers look to get into the market here. Houses range from around R5m to R15m.”

Other popular areas, she says, include the Brenton areas, Simola and Pezula Estates, as well as nearby Sedgefield.

3. Langebaan and Yzerfontein – West Coast

The quintessential West Coast lifestyle of seafood, stories, and beautiful holiday homes is part of the attraction of the West Coast, while the close proximity to Cape Town make these towns easy weekend getaways and home to many holiday homes. Properties here are also very popular with Airbnb and, say Seeff agents Jaco and Tracey Coetzee who sold Calypso Beach Estate homes this year for R8.25m and R8.8m.

Yzerfontein, closer to Cape Town is also a real gem with no commercialisation. Seeff achieved prices of up to R6.5m in Pearl Bay and R6.785m in nearby Jakkalsfontein Private Nature Reserve this year.

4. Pringle Bay and Rooi Els – Overberg/Overstrand

Under two hours’ drive from Cape via Clarens Drive, agents say these quaint villages are located among the natural fynbos of the Kogelberg Biosphere with mountains as a backdrop. Home to a variety of bird and animal species, as well as sea life and a great area for whale spotting, the villages are characterised by a rocky coastline and beautiful white beaches.

Pringle Bay has basic necessities and eateries while nearby Rooi Els is devoid of commercialisation. In Pringle Bay, property options range from small to large homes priced from R2m, with several sales recorded in the R3m to R5m range. Properties in Rooi Els are a bit more expensive with listing prices around R3.6m.

5. Jeffreys Bay and St Francis Bay – Eastern Cape

The picturesque resort towns of Jeffreys Bay and St Francis Bay – both just over an hour’s drive from Gqeberha, are renowned as surfing hotspots. Known for having one of the best right point breaks, J-Bay offers excellent amenities and very accessible property prices, Seeff agents say.

St Francis Bay offers an excellent selection of holiday properties to rent or to buy with a choice of waterfront and golf estate homes, generally ranging from around R2m to R8m.

6. Big Bay and Bloubergstrand – Blouberg

Blouberg is well-known to be one of the top kite surfing destinations in the world and has become a haven for holiday home buyers and property investors looking to capitalise on the lucrative Airbnb market.

There has also been an increase in foreign buyers investing in properties here, including, for example, those with interests in kite surfing as well as buyers from the UK, Germany, and Europe looking to retire here.

Both areas are located right on the coast within walking distance of the beaches and amenities including restaurants, shopping centres, and more.

Big Bay offers a choice of apartments, townhouses and estates, priced from around R2m to R8m on average. Bloubergstrand also offers apartments priced from R2m, as well as luxury houses that can range in price into the upper millions, Seeff says.

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