North Coast rental market shows upward trend as families look to downsize
As some families opt to downsize in response to rising costs of living, reports show there remains a demand for homes in the R20 000-R35 000 per month rental bracket.
Now in its tenth year, PayProp’s second quarter rental index report has indicated a positive rental growth in all provinces after a five-year drought.
PayProp is a leading processor of rental payments for the property management industry with more than 500 000 tenancies, and manages over R66-billion in rentals.
With PayProp noting that tenants are now again beginning to feel the pinch owing to rising living costs, we spoke to local realtors about the North Coast rental market situation.
According to Re/Max Dolphin Realtors’ Candice Elliott, the local rental market has been performing consistently over the past few months, especially after the Covid-19 pandemic during which a huge boom in rental demand was observed with semigration from across the country positively impacting the North Coast.
“But things have changed somewhat after the latest interest rate hike. Families are looking for more value for money and there is a demand for properties in the R20 000-R35 000 per month bracket. This demand, coupled with the interest rate hike, has prompted homeowners with properties for sale to shift towards renting out their homes,” said Elliott.
“In terms of paying rates and levies, it remains cheaper to rent as opposed to paying off a bond. There will always be demand for local rentals because of lifestyle considerations, quality education facilities and more. Ballito offers it all,” she said.
Having always been known to be on the higher end of the rental market, Ballito may see the general asking price lower owing to the rise of living costs.
“These costs always affect peoples’ bottom line. Many people are downscaling instead of renewing their current lease,” Elliott said.
But at the higher end of the rental market, especially in gated estates, the majority continue to hold on to their rented properties.
“These people are first examining the property market before committing.”
This segment has also slowed down in terms of availability.
Elliott said she often advises landlords to look after good tenants.
“Lower the annual increase or help out with a lower rental to keep them,” advising that one would never want to have your home stand empty.
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