While rental yields will likely remain flat this year, the Seeff Property Group expects a bumper year for the Cape rental market.
Despite the challenges, the market has been the best performing in the country, largely as it is so multi-faceted says Samuel Seeff, chairman of the Seeff Property Group. It's not just a holiday or residential market, but is supported by a broad spectrum of demand, from residential and corporate to short-stays and Airbnb. With four universities and many colleges, there's a buoyant student market while further demand comes from various events and the CTICC.
Semigration is back and expected to be a major boost for the market this year, says Seeff. Renting is often an initial preference while they acclimatise before settling on buying in a particular area. For others, renting allows them to live the Cape dream, from a beach to a winelands or country lifestyle even if they cannot afford to buy property.
Despite the recent pressure, landlords have achieved excellent rentals. Seeff's Atlantic Seaboard team for example achieved monthly rentals of R170 000 in Sea Point, R130 000 at the V&A Waterfront, R120 000 at The Aurum in Bantry Bay and R110 000 in Fresnaye. Sonya Garisch and Jacqui Bush from Southern Suburbs concluded several high end rentals of up to R80 000 to R100 000.
Part of the success of the Cape rental market, is that there is an area and price to suit everyone. Seeff's rental specialists provide some insight:
Family tenants
Family-friendly neighbourhoods dominate the rental market. Areas such as Constantia, Tokai and Newlands offer excellent proximity to schools according to Sonya Garisch and Jacqui Bush. Rentals average at R26 000 to R35 000 per month, but well above that for high end properties.
Claremont, Rondebosch, Wynberg and Kenilworth offer affordable price points of R15 000 to R30 000, says Marinda Bienz. Nearby Pinelands, also popular, offers houses for R18 000 on average and R13 000 in Thornton.
Camps Bay ranges from R25 000 to R35 000, but well above this for a luxury home according to Christine Ireland. Fresnaye (close to French School and Herzlia) offers bigger properties with larger gardens for around R45 000. Sea Point and Green Point range around R30 000 to R35 000.
The Welgedacht and Durbanville areas offer a large choice of houses (including security estates) and excellent schools. Rentals range from R19 000 to R25 000 and around R16 000 in more affordable areas such as Sonstraal Heights.
Beach and winelands lifestyle
Blouberg is demand for its beach lifestyle. Nancy Oeschger, Rentals Manager for Seeff says houses cost R13 000 to R18 000 per month and apartments R8 500 to R15 000.
Marinda Uys, Rentals Manager for Seeff Boland, Winelands and West Coast says houses in Stellenbosch cost R16 000 to R30 000 and R15 000 to R35 000 in Franschhoek. Paarl offers more affordable rentals at R18 000 to R22 500, but the estates (Boschenmeer, Pearl Valley and Val de Vie) can achieve up to R50 000. Langebaan houses achieve around R10 000 to R28 000.
Student accommodation hot spots
Areas close to the universities and colleges include the Southern Suburbs between Claremont and Rondebosch (University of Cape Town), Bellville (University of the Western Cape), the CBD (Cape University of Technology) and Stellenbosch (Stellenbosch University).
Students spend R5 000 and R8 000 per month for shared rooms in the Southern Suburbs. Flats range from R10 000 to R12 000 and houses from R16 000 to R18 000. Stellenbosch students spend R5 000 to R7 000 for serviced rooms. Flats range from R8 000 to R14 000 and houses from R13 000 to R20 000.
Young professional and new job market entrants
The rising trend is for young professionals to cluster in cosmopolitan mixed-use areas such as the CBD and Century City where they have access to excellent amenities and lifestyle and the MyCiti transport network.
CBD flats range from R9 000 to R15 000 while Century City rentals are in the R11 000 to R14 000 range for apartments.
Retirement market
The Cape is also popular with retirees looking for a costal lifestyle. Areas such as the Atlantic Seaboard, Blouberg, Strand and False Bay offer excellent amenities and proximity to the beaches for walks and the like.
Strand offers excellent affordability with flats from R5 500 (older flats) to R13 500 (beachfront). Muizenberg flats range from R7 500 to R20 000 (for beachfront). Sea Point and Mouille Point apartments range from R15 000 to R25 000 while Blouberg offers a choice in the R12 000 to R18 000 range.