Lockdown level changes
As South Africa moves through its lockdown levels, different regulations relating to the movement of persons are applied. At first, moving house was not permitted, but as the economy has re-opened, and the property market swings back to life, moving house is now allowed. This has led to an increased demand for:
Affordable property: The affordable property market in South Africa is the busiest sector of the market. And, as the demand for more affordable properties comes into play, tenants who are looking to scale down their financial demands are keen to explore cheaper rental options. Now that tenants are free to move house again, finding a rental property that’s less expensive becomes a priority for tenants who need to cut back their expenses.
Reliable tenants: On the other hand, landlords and property investors are keen to attract reliable tenants who provide some measure of assurance that they’ll be able to keep up with rental payments. To this end, many agencies are noticing a drop in rental prices, as property investors and landlords seek to fill the gap where their reliable rental income once was. To attract the right kind of tenant, comparatively affordable rental prices will become a priority for landlords.
Short-term letting conversions to long-term letting: Under the initial lockdown levels in South Africa, the Airbnb sector took a significant hit. Forward-thinking Airbnb hosts, however, have tackled this challenge by converting many of their short-term stay options into longer-term rental opportunities. By converting short-term rental arrangements into potential long-term rental agreements, landlords are better equipped to secure their rental income and rest assured. This has, however, created a new layer of competition within the South African rental market, as the demand for affordable rental properties grows.
The rental market good news
But, it’s not all doom, gloom, and decreased incomes in the South African rental market. If you’re looking to invest in property, or purchase your first home, the time may be right to begin exploring your options. Between interest rate drops and strong competition across the property market, picking up your dream home at an affordable price is now quite possible. Lower interest rates have led to increasingly more affordable bond repayments, and - as always - property is one of the most reliable investments you could ever make.
Whether you’re a tenant or a landlord, the South African rental market is shifting as we move through our lockdown levels. Stay up to date with news and guidance from our Advice Centre.
Courtesy of Private Property