Millennials turn towards off-plan developments

The millennial market is driving the demand for homes under the R1 million mark and are moving away from being known as ‘Generation rent’ and rather strategic first-time buyers. Mason’s first phase is already 50% sold out, and 67% of the purchasers are within the Millennial age range, which is set between 23 to 38.

“Betterbond reported that the average home price for first-time buyers is currently R982 000, with a 10% deposit. The success behind Mason is in part the attractive pricing, as homeowners need only a R10 000 deposit to secure their unit, and the price range of the modern, 2-bedroom apartments are set competitively with the demand, ranging from R869 000 to 995 000,” shares Graham Kusano, International Housing Solutions representative.

He further explains, “With the recent interest rates cut, off-plan developments such as Mason, help first-time buyers make their step towards owning property a lot easier. The Millennial market are seeing the financial benefit in investing in off-plan opportunities. Having purchased directly from the developer, purchasers are dodging the transfer duty fees, which can account for a big lump sum in established, standard property opportunities. Additionally, with the lending rates currently at their cheapest, those who have secured a bond for the payment of their home, will only start paying towards it once the construction of the Phase is complete and subsequent transfer has taken place.”

The promise of faster capital appreciation also tips the scale in favour of off-plan property investments. Mason starts from R869 000, and once construction is complete, investors can expect to gain 13% capital appreciation and will see their apartment value escalate to approximately R981 970. With the interest rate at its lowest in South Africa, coupled with more banks now willing to offer 105% loans to first-time buyers; we can expect to see more Millennials turn their attention to estates like Mason