Investment Property Search: Sheffield Manor (The Bugle)

With interest rates at an all time low, the prospect of leaving savings in a money market fund yielding a gross 5% before tax, does not make any type of investment sense for the medium to longer term. CPI inflation is currently 5%. Your after tax, real return on cash is therefore negative. The prospect of investing in high yielding property, in an area with high and growing demand for rentals, using debt finance to leverage the amount of equity contributed, is of real interest. 

The cost of money is the lowest in forty years. It is still a buyers market making pricing competitive. If we are to consider which options provide us with the highest possible yields, our focus moves to the market priced between R700,000 and R1,500,000. One of the most successful developments to emerge along the Dolphin Coast, which addresses this affordable market segment, is Sheffield Manor. Providing excellent security with 24-hour access control, a 25m lap pool and club house, waterways flowing into a bass fishing dam, walking and jogging paths around landscaped surrounds, it is easy to see why the sales have been so impressive. 

A total of 321 apartments make up the Sheffield Manor development, with 80 units currently available. Of these 13 are available for immediate occupation, 27 are expected to be completed and occupied by December 2012 and a further 40 will follow as part of phase four. The current pricing ranges from R629,000 for a one bedroom apartment to R979,000 for a three bedroom option. Rental yields range between 7,5% to 8% and there is no shortage of tenants. Body corporate levies and municipal rates represent approx. 16% of the gross yield, providing a before tax net yield of approx. 6,7%. Capital appreciation of these apartments will no doubt accelerate as the development matures, the landscaping grows up and the community takes shape. An analysis of the 149 transfers that have already been registered in Sheffield Manor, since September 2011, indicates pricing that has ranged from R489,000 for a small 49 sqm unit to R1,110,000 for a more spacious 98 sqm apartment. These registered sales have shown a selling price per square meter range from R8,696 to R12,868. The average selling price across all these transactions is R736,107. 

Our rental department is experiencing the acute lack of stock, which is frustrating would be tenants, and Sheffield Manor is one major development solution to this problem. Our Seeff specialist agent for Sheffield Manor, Kelvin Isaac, lives on site and understands the details and subtleties that make Sheffield Manor a great investment option.