Mini-homes are becoming popular in South Africa – here’s how big they are inside
The micro-living trend has arrived in South Africa and is making it possible for easy access to property investing in a niche investment sector that is set to explode in SA as an alternative residential asset with higher yields than other property classes.
This is according to Alexa Horne, MD of Dogon Group Properties (DG), who said that the company has seen high demand for micro-living apartments.
“The world is abuzz with change, and new lifestyles are being embraced. Millennials are looking for location over square footage. They are getting married later, and putting careers first. They want to be close to the city centre, close enough to walk, bike, or rely on public transportation – not wasting time on commuting.”
“Enter demand for the growing lifestyle trend of micro-living, an affordable self-contained, open-plan living space designed to accommodate a bedroom, sitting area and kitchenette in 14–32 square metres situated in the city centre, close to all amenities.”
According to Horne, micro-flats are usually located near key employment nodes in CBD’s of major cities and universities – often in areas where development space is highly limited.
“Student accommodation investment is also considered a very lucrative market (outside of a global pandemic scenario), so micro-living apartments near to universities will enjoy demand from student tenants, bringing in ongoing rental returns,” she said.
Horne said that in addition to millennials and students – there is a fairly wide range of target demographics that are drawn to micro-living apartments.
“Although the youth is currently the largest target market, micro-apartments are becoming relevant in several phases of life – making property investment in micro-living an opportunity for all generations.
“Micro apartments also appeal to new working professionals branching out from their childhood home, and business travellers of all ages who purchase these apartments to stay in whilst travelling for work. There is also a market for the newly retired who are downscaling and wish to spend time travelling and not being hindered by the maintenance and upkeep of a larger home.”
Horne noted that micro-living apartments are attractively priced for their location, allowing young people to get their foot on the property ladder. “The key to real estate is to get your foot on the property ladder as early as possible and micro-living units are providing this opportunity.”
When it comes to investing in property for returns, the biggest concern is the substantial lump sum of capital needed to finance the purchase.
“Given the smaller property size of micro-apartments, the entry point for investors is much lower than that of say a 1- to 2-bedroom apartment. Moreover, the lower price presents the opportunity for property investors further up the ladder to purchase more than one apartment, so the risk is spread across multiple sources,” said Horne.
Paul Upton, head of developments for Dogon Group Properties unpacked a few of the micro-living offerings currently on the market in Cape Town.
Micro apartment living
1 On Albert in Woodstock Cape Town is a block of micro apartments, currently still under construction, that range in size from entry level 21 square metre studio apartments, at a cost of R1.095 million, to 75 square metre two-bedroom units, at a cost of up to R2.65 million for the bigger apartments.
All the apartments at 1 On Albert feature top end SMEG appliances, flat screen smart TV’s and uncapped, unshaped 100megs per second fibre internet – to name but a few of the features, Upton pointed out.
“The development also features communal recreational spaces, shops, a food court, laundromat, heated swimming pool and more – all part of a new conceptual design in living known as integrated living solutions.”
“We have had high demand for the units at 1 On Albert and only 40 are available out of the 130 within the development,” Upton said. Construction is estimated to be complete by December 2021.
Foreshore Place is another current development being marketed by Dogon that offers micro-living apartments.
This mixed-use building is a redevelopment of an iconic 70’s high-rise in Cape Town’s downtown financial district on the corner of Adderley Street, Riebeek Street and St Georges Mall – previously known as the ABSA building.
“Foreshore Place has 15 floors of commercial space with the ground floor offering banking facilities, coffee shops, food and other shops, with 11 floors of residential units rising above, consisting of 99 one-bedroom apartments, nine two-bedroom apartments and 63 studio (micro-living) apartments,” said Upton.
“The residential component of Foreshore Place features its own impressive lobby with 24hr concierge security with access control and CCTV, a laundry area, fully installed VOIP, high-speed fibre connectivity, satellite television ports, air-conditioning, parking bays and much more. Completion of Foreshore Place is scheduled for February 2021.”
Dogon will also soon offer apartments in a new boutique micro-living development in Cape Town called The Ivory.
“Launching imminently, The Ivory will consist of 31 luxury micro-living apartments over 5 storey’s, situated on the corner of Kloof and Kings Roads in Fresnaye on the Atlantic Seaboard. “There is nothing else like it on the market in South Africa currently and this exceptional and unique building will encapsulate the future of desirable modern-day micro living,” said Upton.