Real estate agents Seeff have published an overview of the current Gauteng rental market.
While the rental market in the province remains extremely competitive at the moment, there is still great rental demand and many people – especially millennials – prefer renting to buying currently, the group said.
Below it provided an overview of the major areas in the province and how much it costs to rent a home.
Charles Vining, Seeff’s managing director in Sandton, said that Sandton is currently attracting millennials and a mix of local and expat clients who want to be close to the business environment.
“Larger homes priced between R35,000 – R60,000 are attracting corporate clients coming into the country, as well as families who have sold their homes within the greater Sandton area and whom are looking to rent for a year or two before settling down again,” he said.
“Millennials like the relative freedom of renting versus owning. We see very few young people renting straight after graduating. Most work for a year or so, possibly living at home or sharing with friends, before renting a home of their own.
“Two and three bedroom properties – including townhouses and clusters – are exceptionally sought after in Midrand, Fourways and Sandton.:
- In Midrand, tenants will pay around R8,000 pm for a two-bedroom property and R12,000 pm for a three-bedroom property.
- In Fourways, a two-bedroom property costs around R12,500 pm, while a three-bedroom property costs around R15,500 pm.
- In Sandton, two-bedroom properties fetch around R15,000 pm and three-bedroom properties around R19,000 pm.
Duane Butler, Seeff Randburg’s general manager, says general demand for rental property has declined and rental rates are down due to affordability issues.
“Interestingly, more expensive properties ranging from R15,000 to R25,000 per month is the most active range, while properties priced around R7,000 takes a while before being rented out.
“There are quite a number of rental properties available to choose from at the moment and therefor tenants can often negotiate with landlords for a better rental amount,” he said.
Butler said that rental demand is higher in secure estates, gated off communities and smaller more private cluster developments that command rentals ranging from R10,000 to as high as R18,000 per month depending on what the property has to offer.
Rental property in suburbs like Greenside and Jukskei Park (that offers accessibility to the Fourways Business node), family homes in the Linden area and the suburbs of Randpark Ridge, Sundowner and Northcliff are especially sought after.
Edenvale and Bedfordview
David Ingle, Seeff’s principal in Edenvale, says that Edenvale and Bedfordview have seen an increase in high-end rentals priced between R20,000 to R30,000 per month.
“There is a shortage of stock in this range as many owners are reluctant to rent out their properties fearing that tenants will not take care of them.
“Buyers in the R4 million to R7 million markets prefer to rent high-end properties rather than purchase them as the business environment is still largely uncertain,” he said.
Ingle says the majority of rental stock (mostly sectional title) in these areas is priced between R5,800 and R12,000 per month and property in this range is also the most popular in both areas.
“This price range can offer anything from a studio apartment to a three-bedroom apartment in the different complexes,” he said.
Khosi Sibiya and Phindi Mphahlele, owners of Seeff’s Branch in Soweto, said that the area’s rental market is vibrant, especially amongst millennials.
The agents said that the greatest rental demand is definitely for property priced between R4,000 and R5,000 per month.
“Millennials are the largest generation residing in Soweto at the moment and that they are also the group who rent the most.
“Millennials are moving out of their parent’s homes and forming their own independent households and like the generations before them, they prefer to rent before they buy.
“Rental rates in Soweto at the moment are around R2,500 per month for a one-bedroom apartment, R4,000 per month for a two-bedroom apartment, R4,500 per month for small homes and R7,000 per month for large homes with two garages and possibly a swimming pool as well.”
Steve van Wyk, Seeff’s managing director in Centurion, said he has witnessed a large increase in the demand for rentals – especially for properties that are in good condition.
“The rental market is very strong across all bands with both private and corporate rentals, but most people looking to rent here are interested in properties that are located in estates and complexes that offer good security and are priced between either R6,000 – R12,000 or between R18,000 to R25,000 per month.
Van Wyk said due to the fact that many sellers are battling to fetch their selling prices at the moment, many would rather wait and let their properties out until the market improves.
“We are expecting the rental market here to increase in 2020. Security has become the number one requirement with regard to rentals and enough secure parking and internet connectivity are also important considerations.”
PG van der Linde, Seeff’s rentals manager in Pretoria East, said that the market is saturated with stock and because of that tenants compare rental amounts and value, therefore making it crucial for landlords to price their rental property correctly from the outset.
“Rental demand is high in suburbs in the far east of Pretoria like Hazeldean, Silver Lakes and Lombardy,” he said.
“These suburbs are rapidly expanding and are seeing many new access routes and schools, while medical facilities, a shopping mall, office parks, a commercial district, tourism buildings, hospitality and lifestyle living are predicted too.
Van der Linde Sectional said taht title units in these estates can cost anything from between R12,000 to R16,000 per month and full title homes in upmarket estates can go up to between R40,000 and R60,000 per month.
Another rental hot spot is the suburbs surrounding Menlyn Maine.
All the development in the area has had a positive effect on rental rates and demand for property in suburbs like Garsfontein, Menlo Park, Alphen Park, Newlands, Constantia Park and Ashlea Gardens, he said.
Sectional title units in these suburbs cost between R8,000 to R10,000 per month and full title properties cost from R14,000 to R20,000 per month.