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Some landlords are doing better than others

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Landlords charging rents of R4 500 to R7 000 are currently in a better position than most.

Not only are properties in this bracket most in-demand – and making up around a third of all lease agreements – but most tenants in this segment (82.76%) are in good standing, says Michelle Dickens, chief executive of TPN Credit Bureau. Of this figure, 67.67% are paying their rent on time.

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“Landlords with properties at the lower end of the market – below R3 000 a month – struggle to get their rents, with 16.08% of tenants unable to pay and a further 15.72% making only partial payments.”

She says the traditional sweet-spot segment is monthly rents between R7 000 and R12 000.

Although this segment continued to perform well in the second quarter of this year, there is concern that affordability is acting as a key constraint in this segment while rental escalation remains in negative territory.

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