City’s top rents head­ing to R200 000 a month

Weekend Argus (Saturday Edition) - - PROPERTY -

COULD top-end rents on the At­lantic se­aboard and City Bowl hit R200 000 a month soon? Con­sid­er­ing that prop­er­ties at Zim­bali, on the Dol­phin Coast in KwaZulu-Natal, can fetch R100 000 a month and some At­lantic se­aboard prop­er­ties are al­ready around R170 000 a month, the R200 000 a month mark does not seem far-fetched.

The lat­est FNB Prop­erty Barom­e­ter again points to the At­lantic se­aboard and city bowl as the strong­est prop­erty mar­kets in the coun­try.

While in­evitably slower, given the eco­nomic cli­mate, they still out­pace both in­fla­tion and prop­er­ties in the eco­nomic pow­er­house of Gaut­eng by some mar­gin.

The barom­e­ter notes that at the sec­ond quar­ter of 2017, the At­lantic se­aboard av­er­age house price in­fla­tion rate stands at 29.9% year-on-year and the City Bowl at 21.1%.

Sa­muel Se­eff, chair­man Se­eff Prop­erty Group, says there can be lit­tle doubt that, as with the sales sec­tor, the ren­tals sec­tor of the Cape metro re­mains the strong­est per­former in the coun­try.

Reports from TPN have also pointed to the Cape hav­ing the best-pay­ing ten­ants. This is de­spite the pre­mium that Cape prop­erty now com­mands, in­clud­ing a rental pre­mium of up to 20% and more de­pend­ing on the area.

While R80 000 a month seemed high just two years ago, top-end prop­er­ties in Clifton now com­mand R150 000 to R170 000 a month. Whether these rents will be sus­tain­able is ques­tion­able.

Di­nis Martins, chief op­er­at­ing of­fi­cer for Se­eff At­lantic se­aboard and City Bowl, says it is likely top-end rates will come un­der in­creas­ing pres­sure. While you will get the odd rent at this rate, it is not go­ing to be the norm in a weak eco­nomic cli­mate.

The At­lantic se­aboard is home to the coun­try’s most ex­pen­sive rental mar­kets, both for long and short term, with the high­est av­er­age rates.

Karyn Far­rell, rental ad­min man­ager for Se­eff At­lantic se­aboard and City Bowl, says sub­urbs com­mand­ing the high­est monthly rents are Clifton, Bantry Bay, Fres­naye and the V&A Wa­ter­front, but Camps Bay is also highly rated.

The high­est monthly rents are R80 000 at the Wa­ter­front, R170 000 in Bantry Bay/Fres­naye and R150 000 in Clifton.

While the most pop­u­lar monthly rental range is be­tween R25 000 and R40 000, rents even in Mouille Point can now reach R100 000 a month. At the V&A Wa­ter­front you can rent an op­u­lent pent­house for R170 000 a month.

Es­ca­la­tion rates stand at around 8% on av­er­age while land­lords are achiev­ing yields/ re­turns on in­vest­ments of about 4% on av­er­age, but this varies ac­cord­ing to the prop­erty and lo­ca­tion.


The At­lantic se­aboard and City Bowl are achiev­ing record rents.

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