New mining puts the shine on Mokopane property market

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Property prices in Limpopo's Mokopane have increased by 20 to 30% in the past year and transaction numbers started a sharp upward curve in August Property prices in Limpopo's Mokopane have increased by 20 to 30% in the past year and transaction numbers started a sharp upward curve in August

The recently granted license for new mining activity near Mokopane in Limpopo is bound to give the town’s economy and property market a major boost as rights holder Ivanplats injects some R17bn into its new operation.

The license was awarded at the beginning of November 2014 to mine the platinum flat reef near Mokopane, and is effective for 30 years with the option of a further 30-year extension.
 
This follows hot on the heels of increased production at Anglo's massive Mogalakwena opencast mine 30km north-west of the town, and is excellent news for the town's recovering property market, says Esther van der Merwe, principal of the local RealNet franchise.
 
“Property prices here have increased by 20 to 30% in the past year and transaction numbers started a sharp upward curve in August. Now we are expecting demand to increase even more once activity at Platreef commences and to be sustained in the longer term," she says.
 
“And on the back of that, we are expecting a severe shortage of rental properties that will push rentals up even faster than they are rising at the moment. After the 2009 recession and the more recent mining strikes, many prospective sellers could not find buyers and were forced to offer their properties as rental units, but most of this stock has now been sold - just as the demand for rental units starts to rise too.”
 
Rentals currently range from around R4500/ month for flats to R6600 for three-bedroom townhouses and up to R15 000/ month for luxury homes in popular suburbs such as Chroompark.

And much as developers might like to take advantage of the current market trends, they can’t at the moment because of the instability in the local council and the resulting delays in the provision of new infrastructure.
 
“This means that buy-to-let investors now have a golden opportunity to enter a market where rentals are on an upward trajectory and there is unlikely to be any shortage of tenants for the foreseeable future. But they should not delay, as many young people are now finding that it is actually cheaper to buy than to rent if they can qualify for a bond, and stock is being taken up here at a very rapid rate.”
 
Prices of properties suitable for letting, start at around R550 000 to R600 000 for flats, R850 000 for three-bedroom townhouses and R1,5m for upmarket homes.

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