High demand for property in what was once a small village is driving rentals higher.
The average price of property sold in the Hout Bay area as of June was R3,4m, or 40% higher than it was five years ago, according to Propstats.
James Lewis, MD: Seeff Hout Bay/Llandudno, says the demand for rental property has risen sharply over the past few years and that exclusive homes in sought-after security estates now easily command rentals upwards of R28,000 to R45,000 a month.
“Aside from residential and holiday tenants, there is also significant demand from foreigners, mostly from the UK and Germany. The demand for corporate rentals is also up and now makes up as 20% of all long term contracts,” says Lewis.
But it’s not only the owners of high-end property owners who have seen a dramatic rise in rentals. Janine Barry, broker/owner: RE/MAX Home in Hout Bay, says that a cottage can be rented out for between R10,000 and R15,000 a month and that one-bedroom apartments start from about R5,000 a month. Two-bedroom units generally command rentals of between R6, 000 and R8,500 a month, and a three-bedroom apartment, between R8,500 and R11,000 a month.
“A basic freestanding three-bedroom home could earn a monthly rental of about R15,000. However, monthly rentals of freestanding homes go all the way up to R80,000, depending on the size, view and estate environment,” she adds.
While much of the residential rental growth is still driven by the challenging economic climate, Lewis attributes much of the growth to the rising demand for the lifestyle on offer.
If you consider how the village has transformed over the past few years and how the demand for coastal living has risen, it is not surprising that this would have boosted the demand for rentals here.
The demand is being driven by people who are relocating from other parts of the country, but an increasing number of Capetonians who hail from the Southern Suburbs and Atlantic Seaboard are looking for properties set on bigger stands are choosing to move to the area.
This article originally appeared in Neighbourhood, Sunday Times