Rental Stocks Depleting Fast

Rentals in High Demand - ERA

A Business Report article has drawn attention to the intensifying conditions in the current property market with the demand for rental properties in South Africa literally going through the roof. This is becoming increasingly problematic, as the stocks are proving to be in limited supply.

ERA chief executive, Gerhard Kotze said that this is the broad consensus from a range of group offices around the country. He indicates that although the high interest rates and current inability to afford homes or obtain home loans are the biggest factors driving the rental market, there are also an increasing number of property owners who are opting to downsize to smaller rental accommodation and letting out their own homes to stay afloat financially.

Kotze says, “Infrastructure developments such as those for Eskom and the minerals and precious metals boom, as well as pockets of strong regional development are also creating demand for rental properties”.

According to Helene Visser of ERA Steer Blaauwberg, encompassing the Table View area, her region has had a “very active” rental market of late with a reasonable supply of long-term rental stock and some attractive rental bargains. “But there is also a strong demand for short term rentals and a shortage of furnished rental accommodation. Rentals at the lower end are around R3500 a month and at the higher end around R6500 a month,” she says.

In the East London area, Penny Lindstrom from ERA Sun Beacon Bay says that townhouses are in short supply and thus fetch a premium rental, while ERA Brakpan’s Monica van Tonder says that there is only rental stock available because various new developments are nearing completion.

At ERA Ermelo, Retha de Beer has an enormous rental portfolio, as the mining sector and Eskom’s current expansion in the area are fuelling the demand for townhouses and homes for rent. “Much of the demand is coming from senior management and technical people seconded to these projects,” she says, “and two-bedroom townhouses are renting for around R3300 a month”.

Lucille Kaplan of ERA Pretoria East reports that in Tshwane, there has been a definite increase in rental demand across the board, with prices ranging from R3800 a month to an incredible R25000 a month in some cases.

The information in this article is courtesy of Business Report (“Rental stocks drying up, says ERA”, 25 August 2008).

Property for sale in South Africa.