When Eskom announced its intention to build its second most advanced coal-fired power plant in the municipal area of Delmas in Mpumalanga, few realistically anticipated the pressures this would place on the rental property market in the areas surrounding the plant.
It appears that properties in Witbank, in particular, are in very high demand as a result of the large number of contractors and employees of the power plant look for housing.
As Witbank is known for the coal-mining in the surrounding districts, it has become a popular business destination for many of South Africa’s large corporations including Anglo American and Eskom. Within the municipal radius there are more than 22 coal-mines, as well as a steel mill and several power stations. The construction of the Kusile Power Station has merely added to the number of people streaming into Witbank for business reasons.
This sustained economic growth has resulted in the farm lands surrounding the town to be rapidly bought up by investors and developers to accommodate Witbank’s development and expansion. The pressure to develop the city’s suburbs to accommodate more residents has been increased by the gradual de-population of the surrounding coal-mining villages and, most significantly, the continued development of power stations in the immediate area surrounding Witbank.
In real estate terms, this has created an increasingly active property market with a shortage of rental homes escalating the sales of property. New residents are opting to invest in homes given that investors with rental homes are not actively making these available.
Many young families are particularly attracted to the newer developments for sale and free-standing homes for sale in the more popular suburbs like Reyno Ridge. Another alternative for younger couples or families seeking to buy a home are the family houses for sale in Witbank that were built years ago specifically for the coal-mine workers, as these homes are normally on fairly large erf stands and are well-built and spacious.
Another property trend seems to be the demand for small holdings for sale in the areas surrounding Witbank, with buyers hoping to capture the best of both worlds – essentially having the convenience of living in close proximity to a city and it’s amenities as well as having the peace and quiet of living in the ‘country’. As these properties are in such high demand, and there are very few available, most buyers opt instead to buy properties within the city itself.
Sales of properties under R1-million are at a frenzied high, with homes between R750 000 and R1-million now in short supply. With the first tower of the Kusile power plant scheduled to be completed in 2014 it is safe to say then, should you have the means to buy-to-let, Witbank and it extensions are a smart and safe investment to make.
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