While the rental market in area remains extremely competitive at the moment, there is still great rental demand and many people – especially millennials – prefer renting to buying currently.
Millennials and a mix of local and expat clients who want to be close to the business environment are some of the groups drawn to the popular rental hotspots in Sandton and surrounds, says Charles Vining, Seeff’s MD in Sandton.
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”.
Vining says they are witnessing a trend in Sandton where many millennials are choosing to rent as opposed to buying.
“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 R8000 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 per month, 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 per month.
Security is a major consideration when considering rental property in Sandton. Wi-Fi and off-street parking are almost non-negotiable, while developments with gyms, clubhouses or recreational areas like parks and dams are big draw cards.
Traffic also has a big impact on the location decision of most tenants. For family tenants, school proximity trumps most decisions”.
In general demand for rental property here has declined and rental rates are down because of affordability issues, says Duane Butler, Seeff Randburg’s GM.
“Interestingly, more expensive properties ranging from R15 000 to R25 0000 per month is the most active range, while properties priced around R7 000 takes a while before 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”.
Butler says despite this there is still great demand for rental properties in Randburg, especially those bordering the Sandton suburbs due to accessibility to the Sandton CBD.
We find 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
These areas have have seen an increase in high-end rentals priced between R20 000 to R30 000 per month, says David Ingle, Seeff’s principal in Edenvale.
“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”.
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.
The complexes are all access controlled with ample parking space. Due to the high density of these units only covered parking spaces are available and no garages.
We are pleased to note that developers are starting to supply smaller units in order to cater for an expanding market in the lower rental price bracket.
Greenstone Hill is definitely the rental hot spot in Edenvale, where there is always good stock available and property moves very quickly”.
Ingle concludes that Modderfontein has seen new sectional title stock come available from M&T Developers and Linbro Park has also supplied new stock from Balwin.
“Both these areas are ideal for tenants working anywhere from Sandton to Midrand and Edenvale”.
The rental market here is vibrant, especially amongst millennials, say Khosi Sibiya and Phindi Mphahlele, owners of Seeff’s Branch in Soweto.
“Not many people are able to buy a property in the current economic climate and this, coupled with the fact that there are many new developments taking place in the area at the moment, is fuelling Soweto’s rental market.
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, R4000 per month for a two bedroom apartment, R4 500 per month for small homes and R7000 per month for large homes with two garages and possibly a swimming pool as well”.
There is a large increase in the demand for rentals – especially for properties that are in good condition, says Steve van Wyk, Seeff’s MD in Centurion.
“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 R6000 – R12 000 or between R18 000 to R25 000 per month.
These are also the price ranges in which we experience the most stock shortages”.
Van Wyk says 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.
From a tenant’s perspective renting is also desirable due to the fact that it is more affordable than buying and without the associated costs of property ownership.
“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.”
The market here 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, says PG van der Linde, Seeff’s rentals manager in Pretoria East.
“Rental demand is high in suburbs in the far east of Pretoria like Hazeldean, Silver Lakes and Lombardy.
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.
The whole area offers 12 estates that cater for a wide range of clients, ranging from stack bachelor units to townhouses and free standing houses.
Sectional 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.
“Menlyn is now one of the fastest growing regions in Gauteng and as a result rental property here and in surrounding areas is booming.
While these suburbs have always been popular, interest in the area is now unprecedented due to the tremendous amount of development and job opportunities created.
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.
Sectional title units in these suburbs cost between R8000 to R10 000 per month and full title properties cost from R14 000 to R20 000 per month.