Weekend Argus (Saturday Edition)
Stellenbosch student flats prove a profitable investment
STUDENT accommodation in Stellenbosch is proving an increasingly popular investment channel, according to Johan Hugo, the Rawson Property Group’s franchisee for Stellenbosch and Franschhoek.
“Not l o n g a g o s t u d e n t accommodation market was seasonal, with most sales taki ng pl a c e f r o m August t o December. Now we find that the market remains active all year round and i s i ncreasingly attractive to people from all over the country.”
He says this market is dominated by investors because most students can’t afford to buy, and have to rent accommodation.
S t u d e n t n u mbe r s a r e increasing and the university expects to increase its total intake dramatically by the end of 2015.
Also, rents on units within walking or cycling distance of the campus have for a long time been very satisfactory.
Hugo says for a one-bedroomed flat for sale at R690 000 the tenant pays rent of R4 000 a month, and the rent for a luxury two-bedroomed unit priced at R1.795 million is over R8 000 a month.
He says his Stellenbosch franchise is selling, on average, three accommodation flats a month, in the R600 000 to R1.7m price range.
All have one to three bedrooms.
“Prices here are now rising by at about 4 percent to 6 percent a year,” he says.
Rawson Developers’ 42-unit The Acorns student accommodation consists of one- bedroomed flats priced at around R1.095m.
After a hold-up due to a lack of sewerage treatment capacity in the town, this development has now been given the goahead and will be completed by mid-2014.
Already more than half these units have been sold, says Hugo.
Call Johan Hugo on 071 675 9240 or email johan. hugo@rawson.co.za.