Property News You Can Use – Presented By Harcourts
Property Your Best Investment
- Whether a rental or sales agent, you should not be too concerned despite the recent interest rate hikes.
- Recent stats revealed that residential tenants are paying their rentals despite facing economic challenges exacerbated by load shedding and higher fuel prices.
- Consumers consider rental payments the second most crucial budget credit priority, second only to mortgage or bond repayments.
- This is a vital statistic for property practitioners active in the rental industry. The number of tenants in good standing with their monthly rental obligations improved from 80.78% in the first quarter to 82.22% in the second quarter.
- The strongest commitment is firstly in the R7 000 to R12 000 and secondly in the R12 000 to R25 000 rental brackets. This shows a solid commitment to paying their rent on time, with 88% and 87%, respectively.
- Although tenants paying between R3 000 and R7 000 – a rental bracket which makes up more than half the market – have not yet recovered to pre-pandemic levels and show a commitment of 82.8%. This shows that property is your best investment.
- Interestingly, the worst bracket is above R25 000, with a noticeable deterioration in repayment commitment to 77.38%.
- As interest rates now return to ‘normal levels, it is still a suitable time to buy, and long-term views on investments should now be applied
- On the home loan front, applicants will continue to benefit from attractive interest rate discounts – spurred on by healthy competition among the banks, longer home loan repayment periods and the more realistic pricing of homes for sale.
- Investment and holiday homes at a record high: The percentage of applications for investment/rental purchases continues to rise, reaching a high of almost 8% in August 2022 – the highest level since late 2009.
≈ ≈ Marsha