Business Day Reporter

THE Cape Town residential property market expects to continue outperforming the remainder of the country, and fears of a price bubble are completely unfounded, says John Rabie, chairman of the Rabie Group, the largest independent property developer in Western Cape.

Rabie says that as long as interest rates remain relatively low, the boom conditions will continue even if prices do come off marginally from the highs of last year.

A few factors are underpinning the continuing buoyancy of the Cape Town residential property market.

"Firstly, there is a shortage of zoned land. Currently it can take three to four years to get rezonings through, not least of all because the environmental caucus in Western Cape is much more passionate about both the urban and green environments than they are elsewhere in the country," Rabie says.

He says the Rabie Group has very little land left for housing development other than at Century City, where it is also struggling to meet demand for residential properties.

Infrastructure constraints are a further factor behind the strong property performance. These constraints are reinforcing the shortage of land for development and the supply of new housing stock.