This week’s Landbouweekblad (an Afrikaans agricultural magazine), reports that since October 2013, 42 farms to the value of approximately R235 million have been sold in Franschhoek and Paarl Valley.
The most popular type op property seems to be lifestyle smallholdings (sold for between R2 million – R3.5 million), larger lifestyle estates as well as commercial wine and olive farms (sold from just below R10 million up to R30 million).
Following on the substantial recent Franschhoek investments by Indian businessman Analjit Singh and Sir Richard Branson, the appeal of the Winelands for foreign investors has been reaffirmed. According to the Landbouweekblad article buyers are keen because they can enjoy a relaxed country-side lifestyle without being too far away from a world-class city.
While the weakness of the Rand ensures that investment in some of South Africa’s prime property offers great value to foreign pockets, it is also the natural beauty of the area and the quality of the lifestyle that attract buyers.
And I am sure that in many instances, it is tourism that introduce most buyers to these attributes. SouthAfrica.info agrees. ” Less directly, tourism stimulates the property market – especially prime residential and cluster projects – and strengthens business contacts, often are the forerunners of trade, joint ventures and immigration plans.”
Tourism introduces foreigners to the Winelands and not only might they make a lifestyle choice to move here, but it also generates commercial interest in the area. Some potential buyers consider the development potential of farms for commercial reasons which include the tourism and hospitality industries.
And although we might be sentimental about local ownership, the capital investment of foreigners and the commercial development of properties and tourism offerings do lead to job creation and skills development, both which stimulate the economy.