This luxurious three-bedroom Camps Bay home overlooks the sea and costs a R80 000 a month to rent.
The rental market across the Atlantic seaboard, CBD and city bowl is delivering rocking good results, according to Seeff’s agents across the areas.
They say there is no shortage of tenants who are prepared to pay ever higher rentals to secure a spot in this sought-after residential belt.
Seeff alone has concluded rental contracts worth over R70 million over the last year at rentals on the Atlantic seaboard of up to R80 000 a month in Camps Bay and R42 500 a month in Mouille Point. An apartment at the Pepperclub in the CBD was let at R26 000 a month, a house in Hildene Road, Tamboerskloof fetched R37 000 a month and in Higgo Crescent, Higgovale a house was let at R50 000 a month.
Managing director, Ian Slot says the agency has noted growth in the demand for rentals of up to 20 percent year-on-year over the last few years as more and more people are drawn to the lifestyle on offer in these sought-after suburbs.
“Rental yields currently range between 5 percent and 7 percent depending on the period of ownership,” says Slot.
“The longer you have owned the property, the better the yield. Annual rental escalations are still comfortably around 10 percent and, although substantially above inflation, tenants are quite prepared to pay to secure a home here.”
Although most tenants are still renting for financial reasons given that this is often a cheaper option than buying, the activity is also fuelled by the demand for corporate rentals. The influx of people moving from upcountry, especially Gauteng, is also responsible for up to 20 percent of the demand according to Barbra-Ann Briner and Vivien Adler, agents for luxury homes on the Atlantic seaboard.
According to the agents, there is now a critical shortage of rental properties in the R20 000 to R50 000 a month range. The summer months especially are high demand periods and they urge owners who want to cash in on the activity in the rental market to list their properties as soon as possible before the peak season kicks in spring.
“Clifton, Bantry Bay, Fresnaye, Camps Bay and the V&A Waterfront rank among the most sought-after areas in the country with rentals comfortably above the R40 000 a month range for long-term rentals on small home and ranging to around R80 000. Superior properties can fetch up to R100 000 a month during the high-season summer periods,” says Slot.
“Aside from long-term rentals, the area is extremely popular for short-term holiday and business lets with rates ranging upwards of R10 000 to R100 000 a day depending on the location and type of property. A Mouille Point flat with sea views can for example be let for R10 000 a day whereas a luxury sea view apartment in Clifton could fetch R100 000 and more.”
Camps Bay agents, Christine Ireland and Tamar Cheerin, say that the demand over the summer usually far outstrips supply.
“Aside from locals, there are also a lot of Europeans wanting to rent in the area with French families drawn by the recently opened French school in Sea Point. Rental rates in the suburb now range from R18 000 to R28 000 a month for two-bedroom flats and up to R35 000 for three bedrooms. Houses generally go for R40 000 to R60 000 a month.”
On the Atlantic seaboard, the biggest demand is for three to four-bedroom houses with excellent security around the R35 000 to R45 000 a month range, according to Ireland. Closer to the city, Green Point, De Waterkant, Three Anchor Bay, Sea Point, Mouille Point and Bantry Bay are experiencing strong demand for apartments according to agent Kasia Watchurst.
“Security, parking, DSTV and Wi-Fi are key considerations for tenants and added extras such as a laundry, a gym and a swimming pool add to the attraction and rentals that tenants are prepared to pay.
“As a general rule, rent for apartments in these suburbs now range up to R10 000 a month for studio units and one-bedroom flats go for up to R13 000. Two and three-bedroom apartments range from around R18 000 to R25 000 and houses and townhouses start at R25 000 a month.”
In the CBD and City Bowl a mix of young professionals and European tenants have flocked to the area for rental properties, according to agents Elzunia Singer and Samantha Murphy.
“When it comes to apartments, two-bedroom units are most in demand and now fetch rentals of up to R12 000 a month and as much R19 000 for units with views, parking and two bathrooms.
“There is also strong demand for houses with tenants now paying as much as R25 000 to R30 000 a month for a reasonable family home,” say Singer and Murphy. “When it comes to corporate rentals though tenants pay up to R60 000 a month in the city bowl, although stock of luxury homes is limited making this an ideal opportunity for landlords to list.”
Slot says he expects the rental market across the entire area to continue its strong performance.
“We expect the influx of tenants to continue for at least the next two to three years as everybody now wants to live here. Provided your property is priced right, you are likely to find multiple applications and no shortage of keen tenants,” he says.
