Jozi the Shining Light in the Rental Property Market

Jozi the Shining Light in the Rental Property Market

Private Property South Africa
Private Property Reporter

Investors looking to benefit from the rental property market should consider property in Johannesburg, where the market is proving to be one of the most resilient areas in the country, rather than popular tourist destinations such as Cape Town and the Garden Route. While Cape Town is usually a more popular destination for rental property investments - demand for rental property in Johannesburg is high throughout the year, which means vacancy levels tend to be lower and annuity income more consistent compared to cities and regions where the focus is more on holiday rentals, such as Cape Town and the Garden Route. A lot of fuss has been made over the lurative rental opportunities the World Cup will bring, but agents are warning property owners around the country to tread very carefully. Clients are advised to secure long-term tenants if possible, in stead of hoping to make a killing from rentals during the six weeks in June and July. Expected international tourists during the World Cup are now expected to be only around 300 000, compared to the half a million forecast initially. Match, Fifa's exclusive agent who is offering packages with match tickets, transport and accommodation to international visitors, has already returned 450 000 of the 1,8 million bed nights it had originally reserved to the market. The Garden Route's rental property market, which benefits mainly from short-term holiday rentals during holidays, may even fare worse than in 2009 as many local travellers will also be staying at home during the winter school holiday, traditionally a peak holiday season. The expected higher cost of accommodation, entertainment and travelling will keep many travellers away this year, and it is uncertain at this stage whether the World Cup will be attracting enough tourists to soften the oversupply of rental properties in the market.

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