Pretoria Neighbourhoods Attracting Young Buyers - 10-21-08

October 21 - While the South African property market is struggling overall, there are still pockets in the market where demand is as brisk as always.

Two neighbourhoods in Pretoria are seeing a high demand by young, first time buyers in their 20's and 30's who are keen to enter the property market with the prices currently so low. Eersterus and Mamelodi are seen as good investments because of the rock bottom prices that buyers are able to find at the moment.

Young buyers, however, have their financial limitations and property experts in the area note that the demand remains for homes that sell up to a certain price and then drops significantly after that.

Because of the National Credit Act and the spiralling cost of living, young buyers cannot afford to pay back home loans on houses that cost more than R500,000 and therefore, properties within this price range are popular at the moment.

"Anything up to this price is selling briskly", said Olga Molepo from RealNet in Eersterus. Pretoria. "For instance, we recently fielded more than 20 calls for a property listed at R350,000 and it sold overnight. But buyers show resistance when prices rise over R500,000."

Molepo outlined the reasons why young buyers are so keen to buy these properties. "Many of these buyers have been renting accommodation in this area and have made up their minds to get on the property ladder as soon as their finances allow it. Rentals in the area range between R2000 and R3000 a month, and young couples would rather pay that amount into their own bonds," she said.

Real estate professionals in the area expect older buyers to return to the market for larger homes when the property cycle picks up again.