Publications
Partners
- Almost 11% of residential rental properties were vacant in the third quarter from above 13% in the second, according to a new survey.
- The highest vacancy rates are in the Western Cape.
- While rental prices have been falling, a small average hike was seen in the past quarter.
Some 10.7% of residential rental properties stood empty in the third quarter, which is an improvement from the 13.2% vacancy rate in the second quarter, new data from Tenant Profile Network (TPN) show.
TPN is the largest credit bureau that tracks tenant payment behaviour in SA.
Low-value rentals are the most impacted by persistent high vacancies. Some 12% of rental properties below R3 000 per month are standing empty, while those between R3 000 and R4 500 are 13.32% vacant.
On a provincial level, vacancy rates are highest in the Western Cape (11%), followed by KwaZulu-Natal and Gauteng (both 9.9%).
Residential rental prices are now edging higher - to 0.4% in the third quarter. In previous months, rental prices were in negative territory.
Demand from tenants looking for residential property to rent remained weak due to high unemployment rates and a sharp increase in fuel prices, according to Michelle Dickens, CEO of TPN Credit Bureau.
"Combined, these factors are a powerful incentive driving tenant behaviour towards cost savings such as downscaling, co-habitating or moving in with friends and family," says Dickens. At the same time, rental property supply remains at pre-pandemic levels.
Grant Smee, managing director of Only Realty Group, says another factor plaguing landlords has been finding tenants who are in "good standing". The term refers to tenants with a good credit record and track record who pay their monthly rentals on time each month.
He says a notable trend in renting is that of house sharing.
"Tenants who are spending more time at home are in search of bigger properties and are splitting the costs with family or friends to improve their quality of living," says Smee.
"Often landlords are so desperate to find a tenant that they sign on the first application that they receive. Take the time to do your due diligence. Weigh up the pros and cons and be sure to call their references."
He says it is important for landlords to do some research before listing their rental properties. "Find out what other homes are being leased out in your area to ensure that your listing is competitive. In many cases, we are encouraging landlords to drop their price ever so slightly for the right tenant – especially a tenant willing to sign a longer lease-term," says Smee.
"If your tenant's lease renewal is coming up and they are worth keeping, be sure to negotiate an incentive to make sure that they stay on. This could be something as small as a discount or modifications to the home."
