Following the news that smaller properties are more popular in Dubai, it seems that overseas property investors looking to buy property in South Africa should also aim small.
The latest property barometer from South Africa’s First National Bank shows clearly that small properties are out performing larger houses when it comes to price growth.
Properties 20-80 square metres in size registered price growth of 8.1 per cent year on year compared to 5.8 per cent for 80-230 square metre medium size houses and just 3 per cent for properties measuring 230-800 square metres.
This is a continuation or even increase of the trend towards smaller residences already shown in 2015 where property price growth recorded was 7.5 per cent for smaller properties compared to 6.1 and 3.8 per cent respectively for medium and larger properties.
It is thought that this trend reflects the economic environment in South Africa and also higher transfer duties on larger properties which make potential buyers cautious.
Even though South African’s have historically been attracted to the ideal of larger properties, the popularity of smaller properties, particularly those of innovative design and/or in convenient locations, is expected to continue and offers investors a good opportunity for rewarding returns on their investment.
It seems that when investing in South African property at the moment, small is beautiful.