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Property Talk

Property Talk

Author: Andreas Wassenaar
Date: 2016-04-08
In terms of international research regarding residential property and the buying trends of the wealthy around the world Knight Frank provide exceptional reports and their recently published Global Residential Cities Index makes for interesting reading especially for those of us in the greater Durban area. Instead of tracking mainstream residential prices across a country only, the new Cities Index covers 165 of the world's key urban residential markets. Of the 165 cities tracked, 121 recorded positive annual price growth in 2015. The Chinese city of Shenzhen leads the rankings with prices rising 47.5% in 2015. This Chinese city is becoming a key technology hub and its population of 10 million has an incredibly young average age of 30. Shenzhen is in the Southeastern part of China and links Hong Kong to China's mainland

The Indian city of Chandigarh was the weakest performing city with prices falling 7.7% year-on-year. It is interesting that although a Chinese city represented the highest price growth, China also saw the largest disparity amongst its cities, with 50 percentage points separating its strongest and weakest performing city housing market.

The second highest performing city within the data set was Aukland in New Zealand with house price growth in 2015 of 25.4% - high by all standards but still an amazing 22 percentage points below Shenzhen. Istanbul, Turkey ranked third with growth of 25%, Sydney, Australia fourth with growth of 19.9%. Fifth position was taken by another Chinese city, Shanghai with price growth of 18.2% in 2015.

Believe it or not, Durban ranked highest of the South African cities represented in the Index with annual growth of 11.6% for 2015 taking up the 14th highest position of the 165 cities. Cape Town was in 33rd position with growth of 8.6% and Johannesburg in 52nd position with growth of 6%. The north coast suburbs of Durban, including the Dolphin Coast would have provided the level of price growth required to get Durban's growth to 11.6%.

Of the twenty US cities included in the index, Portland (11.4%) and San Francisco (10.4%) were the strongest performers with Washington DC the weakest (1.7%)

The Canadian city of Vancouver was the highest North American performer with price growth of 11.9% in 2015. Of the 43 cities which saw house prices decline in 2015, 20 were located in Europe

Urbanisation remains a mega-trend and the urban and rural markets around the world are increasingly polarized when it comes to price performance. According to the World Bank, 54% of the world's population currently lives in cities, and by 2045 the urban population will rise by anther 2 billion to 6 billion. Upward pressure on house prices in cities can therefore be expected to continue

On a micro-scale, Ballito is benefitting from a migration from two sources: from Durban suburbs, typically south of Ballito with families migrating northwards, and from Gauteng and Pretoria, as families move down to the greater Ballito area to take advantage of the significantly better lifestyle offering the north coast provides.

For further information and an interactive analysis of this article follow my blog: andreaswassenaar.blogspot.com.

Andreas Wassenaar

Principal - Seeff Dolphin Coast

Cell: 082 837 9094

andreasw@seeff.com