a boom in the kalahari?
2 August 2007

Property prices in Kalahari towns have grown exponentially thanks to increasing iron ore mining activity in the region. In some instances prices have more than quadrupled in the past two years, says Gerrit Vos of Aida. “The whole region has benefited hugely by increased mining activities at the Kumba and Khumani mines. Prices in Olifantshoek and Kathu especially have grown phenomenally, albeit off a low base."

Properties that may have sold at R150 000 in Olifantshoek and R250 000 in Kathu two years ago now sell at around R650 000 and R750 000, he says.

“The market is being underpinned by demand that outstrips supply. Rental accommodation needed for contractors at the mines has created lucrative investment opportunities — rentals of up to R16 000 a month for four-bedroom homes are not uncommon.”

On the downside, if you’re looking to buy to let, he warns that rentals are unlikely to stay at these levels for more than a year or two. But the good news is that property values are unlikely to decline, and at the most, may move sideways.

Local authorities are currently upgrading infrastructure to supply services such as electricity and sewerage to new residential areas.

In Kathu, where 380 stands at a new golf estate were snapped up recently, another 730 stands are expected to be released by the middle of next year when services to the site have been completed. Vos expects brisk demand for these stands.

The buoyant residential sector has also stimulated commercial development, with a new shopping complex planned for Kathu.

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