You're not alone if you're struggling to find a tenant to rent your property in 2020.
Category Landlords / Investors
If you want to rent your property but you're struggling to find a tenant in 2020, know that you're not alone. Not only are there many other landlords in your situation right now, but we're here to support you during this time.
The registered credit bureau TPN just released information about how the rental market has been doing this year. Its TPN Vacancy Survey Q3 2020 showed that more rental properties are empty now than at the beginning of 2020.
The survey indicated that in the first quarter of this year, almost 7.5% of rental homes were vacant. By the third quarter of 2020 (July to September), that number rose to nearly 11.5% of rental properties without tenants.
Why you may be struggling to rent out your home in 2020
While several factors affect your ability to get a tenant, this year was especially challenging for both landlords and tenants.
Many people were financially affected by South Africa's lockdown during the COVID-19 pandemic. According to Statistics South Africa, 15.4% of people it surveyed didn't have an income by the sixth week of the national lockdown - up from 5.2% before lockdown started.
"Until there are job recoveries, the residential rental market will remain under pressure and high vacancies will be the new norm," explains Michelle Dickens, MD of TPN.
She also notes that there are more homes available to let than there are tenants available to rent them. "[Demand] is drying up, coupled with plenty supply on offer. For those tenants with an income, it is a tenant's market."
Renting out affordable homes is the safest bet now
Properties of all price ranges were affected by this slump but landlords with homes of between R4 500 and R12 000 didn't struggle as much to get or keep tenants.
Dickens says that "[no] sector of the rental market was left unscathed with double digit vacancies across the board, although affordable properties in the R4 500 to R7 000 and R7 000 to R12 000 range with 10.31% and 10.34% vacancies respectively the least impacted."
Luxury property and low-end homes were the hardest hit with a total of 17% of properties for rent for less than R3 000 pm left vacant.
Landlords in the Western Cape are feeling the pinch
TPN used its Market Strength Index to determine how the rental market in individual provinces of South Africa is doing. This index looks at the supply and demand of rental homes to show how competitive landlords need to be to place a tenant.
The Market Strength Index for Gauteng is 39, with the Western Cape coming in at even lower than that. With a score of 38 on the index, it's the worst-performing province in the country.
TPN rates the demand for rental homes in the province at 49 in its Demand Rating, with a Supply Rating of 74. It indicates that this excessive supply of homes to let is "probably driven higher by the number of Airbnb properties looking for long-term tenants".
Owners who are trying to rent out affordable properties in the Northern Suburbs of the Western Cape are doing better than the rest of the province though. Only 6.6% of these properties are vacant.
Let our team help you
NS Property Solution's rental agents in the Northern Suburbs and the broader Western Cape have been hard at work and continue to get our landlords both the best deals and tenants for their homes.
Our property management services include letting services, property maintenance and regular reports to our clients. Find out more here.
We're here to go above and beyond to help you on your property journey - and to remind you that we're in this together.
Ready to find a tenant for your property? Get in touch with us today.
*Image by Free-Photos from Pixabay
Author: NS Property Solutions