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According to the Financial Times, Cape Town's population (metropolitan area) grew by 27.6% from 2011 to 2022, landing at approximately 4.77 million. Last year it was estimated at 4.97 million. At the same time, residential property prices increased by about 160% during the period from 2010 to 2024, outpacing all other cities in South Africa. Last year the average price of a home increased by 8.5% in Cape Town versus the national average of 4.5%. And as is the case in most desirable cities around the world, this has some people worried.
But who and what is to blame?
Is it because of tourism? It is estimated that there are some 25,800 active short-term rental listings in the city. Is it digital nomads? South Africa recently launched a Digital Nomad Visa program allowing foreign nationals to live and work in the country provided they can demonstrate an annual income of at least 650,976 ZAR (US$37,500). However, this is a recent thing. Is it foreigners coming with US dollars, euros, and/or pounds? Or is it because of internal migration, which South Africans refer to as "semigration?"
As always, it's a debate. But I think the outcome we are seeing makes intuitive sense for at least three reasons. One, Cape Town is an objectively beautiful and amenity-rich city sandwiched between mountains and the ocean. See above cover photo. It also has a warm and temperate climate. The average high in January (their summer) is 29 degrees and the average high in July (their winter) is 19 degrees. This is a huge competitive advantage — albeit a natural one.
Two, it's a relatively safe place. The above FT article quotes a transplant from Johannesburg saying, "You can't ride your bike in Joburg unless you are in a walled-off estate." If you have the means, that's a strong motivator to move somewhere else. And it's understandably easy to assign a lot of value to safety and security. "Sure, this home may be more expensive, but I can walk to places and ride my bike without fear." That's something worth spending money on.
Lastly, we are all becoming less tethered to specific locations. Digital nomadism and remote work are here to stay. But I don't think this means that people are going to just decentralize and move to the middle of nowhere. I think it means that people are going to increasingly vote with their feet and choose exactly where they want to live their life. What this means is that the need to create better places is only going to become more important. Because more than ever, every place is now in a global competition for talent and investment dollars.
Cover photo by Tobias Reich on Unsplash
To celebrate the launch of their Guide to Cosy Homes (2015), Monocle Films produced a number of home tours.
Die Es, pictured above, is the home of South African architects Gawie and Gwen Fagan. They started building their home in 1964, just as they were starting their practice.
Because of this, they had little money and had to do a lot of the work themselves. They sold their car to buy a concrete mixer.
Although they didn’t set out to explicitly design a “Cape” house, it ended up that way, with heavy thermal masses, white walls, and so on.
The architecture also relates very closely to the surrounding landscape – as it should – in the way in which it frames views of the water and mountains.
The mediterranean climate also really comes through in the materiality of the home and the connections to outside.
If you’d like to watch the 5 minute tour of Die Es, click here.
This morning, instead of my usual routine of writing alongside a cup of coffee, I decided to finally edit all of the skiing and snowboarding footage that I took last month in Park City, Utah. Click here for the final cut.
According to the Financial Times, Cape Town's population (metropolitan area) grew by 27.6% from 2011 to 2022, landing at approximately 4.77 million. Last year it was estimated at 4.97 million. At the same time, residential property prices increased by about 160% during the period from 2010 to 2024, outpacing all other cities in South Africa. Last year the average price of a home increased by 8.5% in Cape Town versus the national average of 4.5%. And as is the case in most desirable cities around the world, this has some people worried.
But who and what is to blame?
Is it because of tourism? It is estimated that there are some 25,800 active short-term rental listings in the city. Is it digital nomads? South Africa recently launched a Digital Nomad Visa program allowing foreign nationals to live and work in the country provided they can demonstrate an annual income of at least 650,976 ZAR (US$37,500). However, this is a recent thing. Is it foreigners coming with US dollars, euros, and/or pounds? Or is it because of internal migration, which South Africans refer to as "semigration?"
As always, it's a debate. But I think the outcome we are seeing makes intuitive sense for at least three reasons. One, Cape Town is an objectively beautiful and amenity-rich city sandwiched between mountains and the ocean. See above cover photo. It also has a warm and temperate climate. The average high in January (their summer) is 29 degrees and the average high in July (their winter) is 19 degrees. This is a huge competitive advantage — albeit a natural one.
Two, it's a relatively safe place. The above FT article quotes a transplant from Johannesburg saying, "You can't ride your bike in Joburg unless you are in a walled-off estate." If you have the means, that's a strong motivator to move somewhere else. And it's understandably easy to assign a lot of value to safety and security. "Sure, this home may be more expensive, but I can walk to places and ride my bike without fear." That's something worth spending money on.
Lastly, we are all becoming less tethered to specific locations. Digital nomadism and remote work are here to stay. But I don't think this means that people are going to just decentralize and move to the middle of nowhere. I think it means that people are going to increasingly vote with their feet and choose exactly where they want to live their life. What this means is that the need to create better places is only going to become more important. Because more than ever, every place is now in a global competition for talent and investment dollars.
Cover photo by Tobias Reich on Unsplash
To celebrate the launch of their Guide to Cosy Homes (2015), Monocle Films produced a number of home tours.
Die Es, pictured above, is the home of South African architects Gawie and Gwen Fagan. They started building their home in 1964, just as they were starting their practice.
Because of this, they had little money and had to do a lot of the work themselves. They sold their car to buy a concrete mixer.
Although they didn’t set out to explicitly design a “Cape” house, it ended up that way, with heavy thermal masses, white walls, and so on.
The architecture also relates very closely to the surrounding landscape – as it should – in the way in which it frames views of the water and mountains.
The mediterranean climate also really comes through in the materiality of the home and the connections to outside.
If you’d like to watch the 5 minute tour of Die Es, click here.
This morning, instead of my usual routine of writing alongside a cup of coffee, I decided to finally edit all of the skiing and snowboarding footage that I took last month in Park City, Utah. Click here for the final cut.
Compared to the video we did for Jackson Hole, I don’t like the selfie perspective as much. It doesn’t show enough of the person. This time we used the Go Pro 3-way arm, but in Jackson we used a plastic tube that I think was used for a beer funnel before that. Next year we’ll go back to that.
Video is a lot of fun and I would love to figure out a way to incorporate more of it into this blog. But that’s a far bigger time commitment and I am not prepared to allocate resources to that. I write every day. That’s my thing.
I am, however, not ignorant to what’s happening in the world of video blogging. And I think there are lots of opportunities for businesses who have the resources to allocate towards projects like this.
Take for instance this vlog by New York video guy Casey Neistat. It’s probably the best piece of marketing that the Phantom 4 drone could have asked for. It’s authentic. I watched it and now I want one. Take my money.
(Note to city geeks: It’s worth watching just for the drone aerials of Cape Town, South Africa.)
To my knowledge, I don’t think people are doing anything like this in the real estate business. But eventually it will happen. Because people are becoming increasingly immune to your typical marketing pieces.
Compared to the video we did for Jackson Hole, I don’t like the selfie perspective as much. It doesn’t show enough of the person. This time we used the Go Pro 3-way arm, but in Jackson we used a plastic tube that I think was used for a beer funnel before that. Next year we’ll go back to that.
Video is a lot of fun and I would love to figure out a way to incorporate more of it into this blog. But that’s a far bigger time commitment and I am not prepared to allocate resources to that. I write every day. That’s my thing.
I am, however, not ignorant to what’s happening in the world of video blogging. And I think there are lots of opportunities for businesses who have the resources to allocate towards projects like this.
Take for instance this vlog by New York video guy Casey Neistat. It’s probably the best piece of marketing that the Phantom 4 drone could have asked for. It’s authentic. I watched it and now I want one. Take my money.
(Note to city geeks: It’s worth watching just for the drone aerials of Cape Town, South Africa.)
To my knowledge, I don’t think people are doing anything like this in the real estate business. But eventually it will happen. Because people are becoming increasingly immune to your typical marketing pieces.
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