Airbnb, rentals likely to stay subdued
THE JURY is out on whether the Airbnb market, and the rental market in general, will thrive or take a dive this year.
Greeff’s Mike Greeff says due to the oversupply of Airbnb properties and the number of developments, buying in the Airbnb market will decline.
“There will be more supply and lower demand, leading to poorer yields for those looking to utilise their property for this medium. We believe long-term rentals will outweigh the trend of Airbnb until the market begins to pick up.”
The rental market and rental prices will “remain subdued”, says Herschel Jawitz, chief executive of Jawitz Properties.
In addition to factors like pressure on disposable income, there is a significant oversupply of rental stock on the market, especially in the sectional-title market due to a large number of new high-rise apartment blocks completed in the past 12 months.
“Rental escalations will barely keep up with inflation in 2019 until the imbalance between supply and demand improves.”
However, Lew Geffen Sotheby’s International Realty’s Yael Geffen says the prevailing economic climate will further encourage investment buying to enter the rental market, which is growing in many areas.
“There are now many good investment opportunities for those with disposable income.”
Other trends expected this year are:
Lifestyle is becoming more important, says Geffen, and how people want to live is a key factor in the buying choice.
PropertyFox saw homeowners investing more in this regard during the past 12 months, purchasing and investing in properties with boreholes and rainwater tanks. The agency’s Nardee Cotterell says they expect this to continue.
Cotterell says the growing need for safety has seen demand rise for homes within security estates.
“With only a few new security estate developments close to the major hubs in Cape Town, estate prices will continue to rise in 2019.”
SAProperty.com’s Charia Thatcher believes offplan purchases in new developments will move much more slowly this year unless builders target entry-level buyers in the R500 000 to R1.5 million property range. “People want value for money and the higherpriced developments will move only if they target a particular market and location.” One of the major trends is the increasing number of people working from home or running their businesses from their homes, says Dogon’s Denise Dogon.
“The blurring of live-work boundaries and changing needs are affecting the kinds of homes buyers want, especially as more people work remotely or are self-employed.”
Homes with fibre connection enabling a seamless work-from-home environment is the norm.
UNCERTAIN TIMESThe Airbnb market could be hit or miss this year for property investors.