A sharp decrease in demand for expensive rental property, a bustling market in the R5 500 to R10 000 per month segment and more people choosing to rent due to the uncertainty of job security are some of the prevalent trends in Mpumalanga’s rental market at the moment.
Nelspruit
Christoph Brink, Seeff’s Rental Marketing Manager in Nelspruit, says this city has witnessed a marked slowdown in more expensive properties and suburbs priced above R15 000 per month, while they are experiencing a major shortage in properties priced between R7 000 to R10 000 per month.
“Multiple applications are received for property that offers good value for money in this bracket. With regard to luxury property, we don’t have an overstock, but it definitely takes longer to lease a more expensive property than an affordable one,” says Brink.
Brink says properties for sale in Nelspruit in the lower brackets offer fairly similar instalments to rental amounts, and therefore buying a property in this bracket for investment purposes could be a good decision, but he warns that large returns must not be expected.
Buyers also need to keep transfer costs, maintenance, insurance and rates and taxes in mind. That being said, you probably won’t have a problem finding a tenant for your property in the R7 000 to R10 000 per month price range, he says.
Pet-friendly developments in Nelspruit are scarce, and are therefore in high demand.
“Security is also an important consideration, and we see a 10% to 20% higher rental rate asked for properties located in security estates,” says Brink.
Middelburg
Willemien Badenhorst, Seeff’s MD in the mining town of Middelburg, says the rental demand in Middelburg’s more secure suburbs located close to the shopping mall and highway are experiencing a high rental demand.
Duets and freestanding homes in the R8 500 to R9 500 price bracket are experiencing the highest demand, while demand for property priced over R13 000 per month is lower.
We do, however, see fair demand for modern properties in secure estates and have recently leased a home in a security estate for R17 000 per month. Tenants are willing to pay up to 20% more for property located in security estates,” says Badenhorst.
She says they aren’t experiencing an "overstock" in Middelburg in any segment, and that most rental property in Middleburg is leased within a week or two of being listed.
“We do, however, have a shortage in secure, pet-friendly complexes and duets priced between R3 000 and R6 000 per month,” says Badenhorst.
The Middelburg rental market is not expected to change anytime soon as there is currently a lot of uncertainty with regards to job security at some of the mines.
Because of this, many people choose to rent. These tenants mainly consist of young families and single tenants who have just entered the work force. Single tenants often rent property for only six to twelve months, while many families who rent renew their contracts year after year.
Secunda
Billy Fick, Seeff’s MD in Secunda, says the rental market in Secunda has taken a knock as many owners have been forced to drop their rental rates and tenants who have a positive credit score are becoming harder to find.
Many tenants prefer to rent in secure complexes, but Secunda does not offer many of these. Consequently, there is a high demand for this type of living, says Fick.
He says their greatest rental demand is for property located in security complexes priced between R8 000 and R9 000 per month.
“Even though the demand for property priced above R12 000 per month is slower, the Seeff Secunda office has recently fetched R20 000 per month and R32 000 per month for two fully-furnished properties. We are also leasing an unfurnished property for R16 500 per month in the upmarket Hibiscus complex,” says Fick.
Well-maintained quality stock of one bedroom apartments priced below R3 500 per month, three bedroom apartments/homes priced at R7 000 per month and luxury homes priced between R12 500 and R15 000 per month is low at the moment.
Many tenants in Secunda prefer to, or are forced to, rent due to the uncertainty in the market and Sasol’s restructuring project - Project Olympus, which follows on Project Phoenix from a couple of years ago.
Like in the case of many other towns in Mpumalanga, tenants in Secunda are also looking for secure, pet-friendly developments that offer safe parking.
Smaller, modern homes in estates in Secunda are sometimes priced lower than larger homes in traditional suburbs here, says Fick.
Lydenburg
Anna-Marie de Jager, Managing Director at Seeff Lydenburg, says the rental market in Lydenburg is very active and they are experiencing rental shortages, especially in the segment priced between R5 500 and R8 000 per month.
Homes in this price range appeal to families looking for three bedroom homes with a garden. There is also great demand for smaller homes located in security complexes priced between R4 000 and R5 000 per month, she says.
“The rental demand in Lydenburg is always big due to many people moving here because of work and the mines’ recent reopening of shafts. We find that these people prefer renting to buying, not only because of job uncertainty, but also because they don’t know the area well.”
Lydenburg would definitely benefit from more housing developments to meet the needs of the rental market. In the past two years security complexes have also become extremely popular.
De Jager says due to the stock shortages here, rental property is quite expensive compared to buying a property.
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