Why Cape Town Southern Suburbs rental market is 'bouncing back'
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Loading... - Valeria James
- 01 Feb 2022
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Specialist credit bureau TPN’s report on the fourth quarter of 2021 revealed that nationally, average rentals increased by only 0.4%, there was also a notable increase in demand and a decline in vacancies during the same period.
This was certainly true in the Western Cape, where a spike in demand saw vacancies drop from 14.4% in Q2 to 11.4% in Q4, with Cape Town’s popular Southern Suburbs faring better than most with a low vacancy rate of 7.8% in the fourth quarter of 2021.
“After a bumper year in 2019, the market ground to a halt in March 2020 and for the remainder of the year we were literally taking one step forward and two steps back,” says Lorraine-Marie Dellbridge, Rentals Manager in the area for Lew Geffen Sotheby’s International Realty.
“For every lease signed, another property - or even two - became vacant and agencies saw very little, if any, growth in their portfolios with the only real activity being an influx of short-term rental properties into the long-term market towards year-end – and at far lower prices - due to the impact of travel restrictions.
“However, last year, the resurgence of semigration, the reopening of universities and increasingly realistic pricing expectations from landlords kicked the market up a gear or two and we were finally able to let the properties that had been vacant for some time.
“Enquiries from students looking for affordable accommodation are back to pre-covid numbers and, interestingly, instead of semigrant enquiries predominantly being from families, a large percentage are now from single young professionals.”
Dellbridge notes that although there was a marked increase in enquiries from KwaZulu-Natal tenants for several months after the July riots, the majority of upcountry tenants are once again from Gauteng.
However, although it’s indeed encouraging that the Western Cape currently has a market strength index of 51.93 compared to the national index of 47.2 (at 50, supply and demand are in equilibrium), Dellbridge cautions landlords against being blasé or overly optimistic. Read More…
