Amidst a slowing economic recovery and rising interest rates, the residential rental market is proving to be surprisingly resilient, according to recent data published by TPN Credit Bureau.
The TPN Residential Rental Market Monitor for the second quarter of 2022 reveals that residential rental tenants are paying their rentals despite facing economic challenges which are being exacerbated by load shedding and higher fuel prices.
Tenants in the R7,000 to R12,000 and R12,000 to R25,000 rental brackets show a strong commitment to paying their rent on time, with 88% and 87%, respectively, in good standing, said TPN. Although this rental bracket traditionally experiences a drop in the second quarter of the year, it tends to strengthen again in the third quarter.
Steep rental increases of 4.17% in the second quarter in the Western Cape have not impacted landlords’ ability to collect rentals. The province’s good standing figure is at 86.61%, while its vacancy rate remains stable. The South African Reserve Bank’s recent repo rate hike to 6.25% is expected to slow residential property sales down, although prices in certain well-serviced areas – which are expected to continue to climb with demand – remain attractive assets.
However, Stats SA’s more recently published Quarterly Employment Statistics – which measures employment – found that total employment declined in the second quarter, losing 119,000 jobs.
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