Deal Verdict
5.8 / 10
Deal Score
Conditional
Priced 11.2% below the Woodstock suburb median, with real built-in equity at purchase. The 7.5% cap rate still falls below the 11.75% cost of debt, which creates negative cash flow at standard 10% financing. This is better suited to cash buyers or investors bringing 30%+ equity and targeting capital growth.
Property Snapshot
Location
Woodstock
Cape Town · Western Cape
Property Type
Apartment
2 Bed · 1 Bath · 1 Parking Bay
Asking Price
R 1,350,000
R 18,750 / sqm
Size
72 sqm
Sectional title · Levies R 1,450/mo
Price vs Market
Asking Price
R 1,350,000
↓ 11.2% below median
Market Median Sale (2-bed, Woodstock)
R 1,520,000
Price / sqm
R 18,750
vs R 21,100 median
↓ 11.1%
R 170,000 below market median, based on 34 comparable sales in the last 12 months.
At R 18,750/sqm vs. the area median of R 21,100/sqm, this property enters with approximately
11% built-in equity, providing a buffer against short-term price corrections.
Investment Metrics
| Monthly Cash Flow (at 10% down) | − R 4,690 | Poor |
| Cap Rate (NOI ÷ Purchase Price) | 7.5% | Okay |
| Gross Rental Yield | 11.1% | Good |
| Cash-on-Cash Return | − 30.6% | Poor |
| Debt Coverage Ratio (DCR) | 0.64 | Poor |
| Gross Rent Multiplier (GRM) | 9.0 | Good |
| Price vs Suburb Median | − 11.2% | Below market |
Why the negative cash flow? The 7.5% cap rate is below the 11.75% cost of debt. This is negative leverage. Every rand borrowed costs more than the asset earns. Increasing the deposit to 30% reduces (but does not eliminate) the monthly shortfall. Investors should model this as a capital-appreciation play, not an income play, at standard financing terms.
Cash Flow Breakdown | Monthly
Gross Rental Income
+ R 12,500
− Vacancy Allowance (5%)
− R 625
Effective Rental Income
R 11,875
− Bond Repayment (R1.215M @ 11.75% / 20yr)
− R 13,170
− Rates & Taxes
− R 920
− Body Corporate Levies
− R 1,450
− Insurance
− R 400
− Maintenance Reserve (5%)
− R 625
NET MONTHLY CASH FLOW
− R 4,690
Net Annual Cash Flow
− R 56,280
Financing Summary
Purchase Price
R 1,350,000
Down Payment (10%)
R 135,000
Transfer Duty
R 7,500
Legal & Conveyancing
R 41,500
Loan Amount
R 1,215,000
Monthly Bond Payment
R 13,170
Interest Rate
11.75% p.a.
Bond Term
20 years
Deal Analysis
Strengths
- Priced 11.2% below the suburb median, with measurable built-in equity at purchase.
- GRM of 9.0 is solid; gross rental yield of 11.1% is competitive within Cape Town's residential market.
- Woodstock rental demand remains consistently strong. Urban professionals, proximity to the Cape Town CBD, and a track record of low vacancy support the rental case.
- Sectional title reduces direct maintenance burden; body corporate handles common-area and building upkeep.
Risks & Red Flags
- Negative leverage at standard financing: Cap rate (7.5%) is below the cost of debt (11.75%). Every rand borrowed costs more than the asset earns Monthly shortfall of R 4,690 must be funded from other income.
- Rent estimate is above market median: At R 12,500/mo, the estimate is 5.9% above the area median of R 11,800. Optimistic rent assumptions are a common valuation pitfall. Verify with two independent agents before running projections.
- Listed 45 days: Not alarming, but worth understanding. Investigate whether body corporate fees, building condition, or hidden defects have deterred earlier buyers.
- Single parking bay: May limit rental appeal to double-income households and constrain re-sale value in an area where parking is at a premium.
Suggested Offer Prices
Aggressive
R 1,150,000
14.8% below asking
Fair Value
R 1,240,000
8.1% below asking
Maximum
R 1,300,000
3.7% below asking
Aggressive: brings acquisition cost to ~24% below market median, improving cap rate to ~8.9%.
Fair value: aligns price/sqm with comparable listings at R 17,222/sqm.
Maximum: threshold above which the investment case deteriorates further. Do not exceed without strong evidence for higher rent.
Verify Before Proceeding
- Request the last 12 months of body corporate levy statements. Look for special levies, pending building assessments, or arrears.
- Obtain body corporate annual financial statements and confirm reserve fund balance is adequate for the building's age and condition
- Confirm the rental estimate with at least 2 independent local property managers. Ask for current comparable rentals, not asking prices.
- Commission a professional building inspection focused on damp ingress, structural cracks, and electrical compliance (common issues in older Woodstock stock)
Market Context
Woodstock, Cape Town | 2-bedroom apartments | last 12 months
Median Sale Price
R 1,520,000
n = 34 sales
Median Monthly Rent
R 11,800
n = 28 active listings
Median Price / sqm
R 21,100
This property: R 18,750
Market Gross Yield
9.3%
At median price and rent
Data Source & Notes
PropScout market median database, derived from Property24 public listings.
Reflects advertised listing prices and rental rates; not confirmed transaction values.
Sample period: 12 months to March 2026.
Disclaimer: This report is generated by PropScout for informational purposes only and does not constitute financial, investment, tax, or legal advice. All metrics are calculated from publicly available listing data and stated assumptions. They do not guarantee future performance or actual rental income. Market medians are based on advertised listing prices and may not reflect confirmed transaction values or current market conditions. Transfer duty is calculated at SARS 2025/26 rates. Conveyancing costs are estimates only. Obtain formal quotes from a conveyancer. Always conduct independent due diligence and consult a qualified financial advisor, registered property practitioner, and conveyancer before making any investment decision. PropScout (Pty) Ltd accepts no liability for decisions made on the basis of this report.