A significant number of senior citizens over 60 years of age are currently migrating from bigger freehold properties to smaller units in security villages and retirement villages in Pretoria.
Jimmy Du Preez, an agent with Seeff Pretoria East, says the majority of seniors and retirees commence shopping around for affordable retirement villages in their late 60’s. By ages 70 – 72 years they are usually established in a suitable retirement environment.
“This does not only reflect patterns inside the borders of bigger metropolis, but also relocation from smaller country towns and farms.
Developers must have anticipated this phenomenon because a number of new retirement villages have lately arisen around the country.
The erection of these retirement villages contributed to the oversupply of larger freehold properties in the market in general and increased prices and demand for retirement villages”.
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Du Preez says older retirement village developments dated back to the 1980’s and 1990’s are spacious with wider open outside spaces and gardens and were especially fashionable amongst energetic retirees with the financial backing to enjoy travelling and exploring new adventures.
“Levies to maintain the older buildings, bigger open spaces and gardens are generally higher than in more modern retirement villages.
Motivation for seniors to relocate to retirement villages is currently fueled by factors such as 24/7 manned security, assisted living and frail care services, catering services and peer group interaction”.
Du Preez adds that modern retirement villages represent significantly more, but smaller units which are built closer together.
“Modern villages reflect contemporary building styles and finishes such as open plan kitchens/lounges/dining rooms and patios, two or three bedrooms, one or two bathrooms and undercover parking or garages.
This comes at a price though and these unit prices are generally higher than in older retirement villages”.
Du Preez continues that there is still a belief that funds derived from the selling of a big freestanding property will be able to afford a unit in a retirement village plus a capital investment.
“Seniors citizens and retirees find it more and more difficult to satisfy their needs for living in retirement villages.
Single and twin bedroom townhouses in older retirement villages and bottom and top stack apartments in modern retirement villages represent the lower end of affordability at between R1,000,000 and R1,600,000 and townhouses with bigger, more spacious rooms representing the higher end of R1,800,000 to R2,600,000.
Developers persist with a mix of property types of apartments and townhouses and now also offer studio apartments in modern retirement villages.
These provide a single, modern living bedroom, own bathroom and kitchenette, basic medical care and meals at affordable prices for a price less than R 700,000. These units are suitable for couples, single occupants and/or those in need of assistance living.
Investors invest in retirement units for use by family members, own use in future or re-sale when markets turn favorable.
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Decline in revenue from pensioner investments limit investors’ annual rental increases to below inflation and levies are also cmparably higher. Rental units are therefore in low supply and even heirs of retirement units opt to sell, rather than to rent out”.
Du Preez concludes that subsequently rental demand is comparably low from seniors and retirees. Capital growth in retirement villages is generally higher than in similar units outside.
“Featherwood in the east of Pretoria is a retirement complex with all the latest services of manned security, assisted living, frail care and catering services and different types of accommodation associated with a modern-day retirement village.
Several new studio apartments and two and three bedroom apartments are still available. Prices vary from R 699,000 to R 1,770,000.
The building of units in a new development in the Waterkloof Ridge area in Pretoria called Waterkloof Marina will also commence soon”.
