Student accommodation is among the fastest-growing property sectors globally, with a similar trend appearing evident in South Africa where the supply-demand gap for this asset class is widening. According to estimates by the World Bank’s International Finance Corporation, the shortage of student beds in SA will reach 780 000 by 2025. This makes an investment in accommodation close to universities such as Stellenbosch University, and educational institutions, a viable choice for those seeking strong net yields and solid capital growth.
Says Varga: “Over the years the student accommodation market has evolved with more amenities offered and security a firm priority. A new two-bedroom unit now includes two bathrooms and two parking bays, while developments are starting to cater for load shedding. At My Space, modern-designed apartments in three different venues – My Space@Drostdy, My Space@Dorpstreet and My Space@Paradys, there will be WiFi in all communal areas during loadshedding, while these blocks also include a number of social spaces, game rooms, gyms, private courtyards, special study spaces, a zoom room, deli, laundry and braai.
“Taking into account the growing need for student accommodation, the local council has adopted the densification process, with new developments being renovations or rebuilds of older buildings. To illustrate, My Space@Drostdy was formerly the Drostdy retail space, Stellenbosch Lodge is now an apartment block called My Space@Paradys, and in developing The Niche, three adjacent houses were acquired, the erven consolidated and an apartment block constructed on the site.”
At present Pam Golding Properties is marketing units in 14 residential developments in Stellenbosch – comprising eight sectional title apartment blocks, all of which cater for students or young professionals – and five general residential developments.
At present, sectional title blocks catering for students only are: Da Vinci, Archimedes and Deo Gloria, while sectional title blocks for young professionals or student accommodation are: The Niche, My Space@Paradys, My Space@Drostdy, My Space@Dorpstreet and The Alxandr. Prices at these developments range from R1.75 million to R 5.45 million for loft, one, two, three or four-bedroom apartments.
Other residential developments marketed by Pam Golding Properties in Stellenbosch include Welgegund Domaine Prive, Newinbosch, Longlands Estate, Oakview Estate and Vini Fera at Anura, at a broad cross-section of prices ranging from R875 000 to approximately R13.69 million, depending on the development and whether you buy vacant land or a house.
Varga says that apart from local purchasers, Stellenbosch has in recent years experienced a marked increase in semigrating home buyers, prompted by good schools, exceptional service delivery and an enviable lifestyle. Proudly a student town, it’s historical with an abundance of natural beauty, majestic mountains, world-class wine farms and in relatively close proximity to Cape Town International Airport.
Adds Varga: “Approximately 47% of our buyers are locals in Stellenbosch, 24% from Gauteng and KwaZulu-Natal, 21% to surrounding towns in the Boland & Overberg and Western Cape in general, and the remaining 8% are purchasers from other provinces and international buyers. Upcountry buyers tend to rent for a year before they buy, which accounts for the high proportion of Stellenbosch buyers – who include savvy buy-to-let investors catering for the high rental demand while achieving wealth creation through astute property investment.
“In Newinbosch, located on 48ha at the northern entrance to Stellenbosch, and only 3km from the Stellenbosch CBD, the university, college, schools, hospitals, Technopark and other business parks, buyers have access to a diverse variety of options across all price ranges. A total of 1 320 units across apartments, simplexes, townhouses, courtyard homes and homesteads are complemented by a host of amenities including a retail centre, crèche, primary and high schools, church, clubhouse, eatery, gym, tennis courts, dog park, skateboard park, amphitheatre, urban farm, 25m swimming pool, children’s pool, cycling and running routes, cricket nets and children’s play areas among others.”
