The continuing weaker Rand against major international currencies is stimulating foreign buyers’ interest in lifestyle farms of the Stellenbosch.
While ordinarily the sales of lifestyle farms tend to be a low-key affair, foreign buyers in particular are taking advantage of the low Rand to snap up these properties, many of which are to be found in the wine and olive growing areas of Stellenbosch.
A lifestyle farm is a farm that is not run as a large commercial operation, but may include a boutique winery, guest cottages or the like.
According to Chris Cilliers, Lew Geffen Sotheby’s International Realty Principal for the Stellenbosch area, a lot of the interest in the lifestyle farms is coming from Europe and America and this relates directly to the current poor performance of the Rand.
“The weak rand is stimulating interest from overseas buyers. Recently we have sold farm properties to Swedish and German buyers and we are even getting enquiries from Belgium and Italy where there seems to be lots of interest and it is definitely because of state of the local currency,” said Cilliers.
“The European economy is recovering at the moment, which is good news for us from an international buyer perspective.”
Cilliers added that her office was currently in the process of selling a small holding to a South African expat in the USA.
“Many buyers are interested in the lifestyle farms more than they are in massive farms. In fact the only thing causing any hesitation on the part of foreign buyers is the recent press we’ve had surrounding issues of land reform.”
These lifestyle farms for sale have been coming onto the market by owners who are down-scaling their lifestyle or retiring from active farming. It is because these exceptional properties are rare that they attract higher prices the more so when they are located in just the right area.
The extras on these properties often include boutique hotels, rental cottages, restaurants or even established wineries. The infrastructure and facilities on each property play a big part in determining the price according to George Cilliers, who markets exceptional properties in the Cape Winelands for Lew Geffen Sotheby’s International Realty.
“The price of such properties really depends on the size and the location. The average prices for these lifestyle farms can be anywhere from R10 million to R25m. In fact we recently sold a four hectare property with a winery and a small vineyard for R14m,” says George Cilliers.
As to whether historical properties tend to be more attractive to buyers, he says that it almost exclusively depends on the condition of the property.
“We recently had an old perfectly restored farm property that sold for over R10m, but often these historical properties need a lot of modernising and that can be quite costly for the buyers, so they don’t sell for as much as people might expect.”
The prices for large commercial farms can be quite a lot more Cilliers says. “You just have to look at properties such as the award-winning Amani Vineyards Estate in Stellenbosch which is on the market for R42m. This 38.65 hectare estate has sustainable production and 32.4ha of vineyards.”
The Stellenbosch area offers some of the most sought after properties in the cape Winelands region and there is continuing international and South African interest in these farms many of which produce some of the best wines in South Africa.
According to Lew Geffen Sotheby’s International Realty there are more than 600 wine farms, lifestyle farms and 123 wine cellars in the Stellenbosch area.
According to company Chairman Lew Geffen, local and foreign buyers have realised that for a price equivalent to a luxury house on the coast they can purchase a farm providing a highly desirable lifestyle in a tranquil, country environment that’s just a short drive from the ocean.
“It’s the best of both worlds if one thinks about it, and we probably get more than enquiries for these types of properties than other realtors in the area because international buyers know the Sotheby’s brand.”
One such farm on George Cilliers’ books is typical of the properties offered. It is a a 17-hectare lifestyle and wine farm situated within easy reach of Stellenbosch in the Stellenbosch Valley. The lifestyle farm has 11.5 hectares of trellised vineyards with irrigation. The farm also has two large dams ensuring unlimited water all for an asking price of R12.9m.
“The property is ideal for a buyer wanting to build his own home on the north-facing slope with wonderful views and protected from the South Easter wind. It is also ideal for nature walking.”