Weekend Argus (Saturday Edition)
Growing demand for homes to rent
Shortage of flats and houses looms as seaboard and City Bowl agents sign more than one a lease a day on average
THERE is a shortage of rental stock across the Atlantic seaboard and City Bowl as demand continues to surge into the winter months, says Seeff ’s managing director for the areas, Ian Slot.
“In some areas, the available stock has almost halved this year and this has become a major challenge for our agents,” he says.
“The rental market is at its busiest during October to April, but this year the demand has carried on into the winter. July, for example, was our best month this year, with 40 lease deals, yielding about R600 000 in monthly rentals and a total of R7.2 million in annual returns for landlords.”
On the whole, the rental market is active and landlords have had significant returns over the past year. This is good news for landlords and wouldbe investors wanting to capitalise on the demand, Slot says.
“Seeff has concluded 369 leases over the past year, earning almost R53m for landlords. This was in effect a lease a day and more than 80 percent were for a minimum 12-month lease. We have also had a significant increase in our managed rental book as landlords are increasingly looking for a full management solution.
“More than 60 percent have been new leases with new entrants to the areas. Although many tenants see renting in these sought-after locations as a cheaper alternative to buying, many are considering settling here in the long term, but choose to initially rent.”
Clifton continues to have some of the highest rentals in the country, says Seeff ’s Atlantic seaboard rental specialists, Vivien Adler and Barbra-ann Briner, who recently concluded a 12-month rental agreement for a property in Victoria Road at R80 000 a month.
“Apart from panoramic sea views throughout, the apartment has direct car lift access to the front door, a 24-hour concierge service, state-of-theart security, a communal swimming pool and direct lift access to the beach,” say the agents.
“Luxury apartments on the sea side of Victoria Road attract monthly rates upwards of R35 000 for two-bedroomed units, to R65 000 a month for a four-bedroomed unit in one of the most sought- after complexes.
“Bantry Bay and Fresnaye are also popular with tenants. A villa in De Wet Road in Bantry Bay has been let at R45 000 a month. Rental yields at the top end in Fresnaye include a home in Ave Disandt at R40 000 a month, R55 000 a month for an Ocean View Drive home, and R58 590 a month for a property in Arcadia Road.”
In Camps Bay tenants have been prepared to pay some of the highest monthly rental rates over the last year. Luxury villas here now yield upwards of R32 000 a month. Some of the noteworthy monthly rentals achieved R35 000 each a month for two villas in Geneva Drive, R45 000 for a Medburn Road villa, and R48 000 a month for a Theresa Avenue home.
A Park Road property has been let at R55 000 a month, and a unit in Camps Bay at R52 500 on a 12-month .
Agent Kasia Watchurst says: “The Sea Point and Green Point markets have been especially active, with 52 and 32 leases respectively.
“About 35 of the Sea Point lease deals are yielding rental returns above R10 000 a month, while five are being let at more than R20 000 a month. The highest rental here is R28 500 for a home in Main Drive on a twoyear lease.
“In Green Point, almost half of all deals fall above the R10 000-a-month bracket, with two luxury properties let at R20 000 a month. The highest rental here is R23 500 for a property in Braeside Road.”
Rentals for apartments at the V&A Waterfront are more than R20 000 a month on average, say Adler and Briner. Sim- ilarly, Three Anchor Bay apartments remain popular with tenants willing to pay between R25 000 and R27 000 for units at Ventnor House and Black Rock, on 12-month leases.
In the City Bowl, demand for flats to rent in the CBD contin- ues unabated, say agents Jules Arnott and Craig Watchurst.
Seeff has concluded 82 lease agreements over the past year at an average monthly rental of R9 771. Most notably, 26 flats are being let at more than R10 000 a month. This includes five rentals above R20 000 a month, the highest being R25 000 a month for a Pepper Club apartment on a 12-month.
Most tenants are younger professionals wanting to take advantage of the buzz of the city centre and the convenient location. The CBD offers a number of modern, secure lifestyle developments at attractive rentals, especially compared with the cost of buying similar properties and servicing bond repayments, rates, levies and maintenance costs.
“Longer-term rentals have been most in demand.”
Suburbs such as Gardens and Tamboerskloof have also been particularly active, says Elzunia Singer.
“In Gardens we have concluded 22 lease agreements, mostly long-term leases and almost half at rents of more than R10 000 a month. The two highest rentals here are in Upper Union Street, at R18 500 and R21 000,” says Singer.
Two homes in Tamboerskloof have been let for more than R20 000 a month. One, a Queens Road home, is being let at R21 500 and the other, in Carstens Street, at R25 000, says Christine Ireland.
In Higgovale, a home in the sought-after St John’s Estate has been let at R27 000 a month, for 12 months, and a home in De Lorentz Street in Oranjezicht has been let for 17 months at R26 500 a month.
Singer says that there is also more demand for short-term rentals, driven by foreign visitors who are initially looking for short-term lets, but with a view to staying longer.
“We have noted a significant influx of French nationals along with many Europeans wanting to settle in the city and quite prepared to pay rentals of between R14 000 and R25 000 a month. Would- be landlords need to bear in mind that tenants will pay for what they perceive as good value. Although demand is buoyant, overpriced rental properties are just not attracting interest.”