The average rent in South Africa is just under R8 000 a month, but living among us are those who are happily paying more than R100 000 for their long-term rental properties.
Some of them even fork out more than R300 000 a month for a luxury living lease agreement. Apparently it is cheaper than buying.
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This three-bedroom, four-bathroom apartment in Fresnaye, on the Atlantic Seaboard, is just one example of a luxury home that secured a tenant for its R120 000 monthly rent. Marketed by Tiaan Vosloo of Tyson Properties, this penthouse has finishes and views that will “take your breath away”.
The bedrooms are all en-suite, it has a private lift, double garage, private solar-heated infinity pool, full home automation, climate control, and full frontal ocean views, to name just a few features.
And this is no short-term let, but was marketed at tenants requiring a long lease.
Another property listed for a monthly rental of R120 000 – and which also secured a long-term tenant, is this four-bedroom, four-bathroom house in Camps Bay.
Vosloo says the property is ideally located in a quiet road close to the beach in Camps Bay, and that it “boasts all things convenient for a family looking for an upmarket property”.
“The home is set over three levels, with open plan living spaces, high volume ceilings, ample accommodation, and modern touches right throughout...The middle level is sensational, with double volume high floor to ceiling glass windows, allowing for incredible ocean views and natural light from the inside of the home.”
In addition, the back of the home has a large multi-purpose room which is perfect for an office, home schooling, gym, play room or additional bedroom, and the entertainment at the back is “incredible, boasting another huge patio with an outside dining room table, a shaded lounge area, a built-in braai and a huge private garden with a jungle gym, making it a kids paradise.
“The home has top security features right throughout and will impress anyone who views it,” he says.
Vosloo, who markets properties on the Atlantic Seaboard, but specialises in Camps Bay, says these R120 000-a-month properties – that are not even considered high-end in the luxury market – are often rented by a mix of international and local clients.
“Often it is people needing a place to stay whilst renovating their primary residence or people renting to try out Cape Town before buying.”
But why would they pay that much in rental when they can rather buy their own homes, one may wonder. The answer, he says, is simple.
“It’s much cheaper than buying. If you are renting a property for R150 000 per month, it’s likely to be a R35 million+ property, where your bond would be over R300 000 per month excluding rates, taxes and maintenance.
“I conclude long-term rentals of over R100 000 per month every month. It is very common in the areas of Camps Bay, Clifton, Bantry Bay, and Fresnaye, and clients are familiar with the going rates.”
The current demand for long-term rentals on the Atlantic Seaboard in Cape Town is at an all-time high in Vosloo’s experience.
“When going to market with a rental of over R100 000 per month, I would immediately start getting calls and doing viewings. The areas are just incredibly desirable on an international scale, and due to properties fetching much higher prices on short-term holiday rentals, when a luxury property becomes available for a long-term rental, whoever acts quickest, gets it.”
He says the highest-priced 12-month rental he has concluded was for R325 000 a month. It was snapped up by an international couple looking to experience what Cape Town has to offer.
“Rentals between R100 000 and R150 000 per month get rented out quickly once marketed due to the demand. I have concluded many rentals over R250 000 per month and these properties are usually not advertised but rather sourced for specific clients in my network.”
James Carney, another agent for Tyson Properties Atlantic Seaboard, says tenants for these R120 000 homes range from affluent families to groups of two or three professionals. Echoing Vosloo, he says these costs are cheaper than buying a similar home in Cape Town.
“Clients who rent for R100 000 per month are likely renting a home with a value surpassing R20m. To bond a home for R20m, you are looking at monthly repayments of around R170 000 per month.”
He too says that the agency secures tenants for R100 000 properties on most months.
“Over the past few years, the number of clients willing to pay these figures has gone up dramatically.
“I believe that market uncertainty is a big reason for clients looking to rent rather than to buy. They want the flexibility of not having all of their funds tied up into an asset which could take a few months to sell.”
He adds that there are locals who are paying more than R350 000 a month for long-term rentals.
“The highest long-term rental which we have done is substantially more than this.”
Liam Mally of Tyson Properties in the Southern Suburbs says tenants of these luxury rentals are locals and foreigners, some families, and some couples.
“They don’t want to be tied down in South Africa and it’s cheaper to ‘rent’ the lifestyle instead of buying it. It allows them to be more mobile and allows them to even change areas, without detracting from their lifestyle.”
He adds: “The demand is high for these kinds of properties. Most of the owners are looking to sell their homes and rather rent and take their money offshore. Those who do sell end up renting the same spec houses as it’s cheaper to rent than pay a bond and have the money invested. Demand is even higher with semigration of locals to Cape Town.
“For the foreigners, the exchange rate favours them and therefore they are able to rent higher priced homes.”
In his area, the highest rental property was for R135 000 for a 24-month lease.
“It was a local family of four renting whilst their house was being built in Bishopscourt.”
To find a property to rent in your price range, visit IOL Property.
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