Cape Town destination of choice for Nigerian property investors
In Dubai, United States, United Kingdom, other European countries and beyond, Nigerian investors and home buyers are quite visible, which is why in the upscale Palm Jumeira in Dubai and choice locations in London, houses owned by Nigerians can compare in number with those of a small village in a rural Nigerian community.
Similarly, in Africa, Nigerians are all over the place as homeowners and also as investors. This explains their large presence in Accra, Ghana, The Gambia and other countries. Today in South Africa, Cape Town is the new destination of choice for Nigerian property investors.
At present, South Africa’s currency is having challenges, which means luxury properties, particularly on Cape Town’s wealthy Atlantic Seaboard, are becoming increasingly attractive as investment opportunities for international buyers, many of them Nigerians.
Lew Geffen, chairman, Lew Geffen Sotheby’s International Realty in South Africa, says Cape Town’s exclusive Atlantic Seaboard is the biggest draw-card for Nigerian citizens wanting to invest in property, which is considered one of the safest with highest return on investment.
All Nigerians visiting South Africa as tourists are automatically given temporary residence permits, but these cannot automatically be converted to permanent residency.
“Our highly-developed infrastructure, as well as the fact that there are so many established Nigerian communities in the city, makes property investment in Cape Town additionally attractive,” says Geffen.
Geffen says property enquiries from Nigerian citizens have in the past year increased by approximately 250 percent on the Atlantic Seaboard, which boasts some of the richest real estate in the world.
“But that said, the local currency, the Rand, has hit five-year lows against the world’s major currencies and Nigerian economic growth has been double that of South Africa for a few years now, so Nigerian investors are in a good position,” he adds.
According to Brendan Miller, Atlantic Seaboard principal for Lew Geffen Sotheby’s Realty International, while the Nigerian property market is experiencing rapid growth, many Nigerian buyers cite a lack of quality supply, as well as the massive surge in house prices back home and limited resources for mortgage lending, as their reasons for looking at property investment in South Africa.
“In Lagos, for instance, an apartment in the city centre costs an average of $3,000 per square metre, while an apartment outside the centre will put a buyer back about $1,100. So if you have $1 million to spend and you’re looking for a property in an up-market suburb in Lagos, you’re unlikely to see much change from that,” says Miller.
“In Bantry Bay, $1 million could easily translate to a four-bedroom home with 180° sea views, which can be let to tourists for additional income for at least six months a year.”
Property prices across South Africa increased by an average of around 8 percent last year, with suburbs on the Atlantic Seaboard generally performing just above that.
CHUKA UROKO