The TPN Residential Rental Monitor report has revealed the provinces with the highest and lowest average rental prices. Picture: File
The Free State has the lowest average rent for full title property and sectional property for Q2 2024, according to the TPN Residential Rental Monitor report which revealed the cost to rent in the nine provinces of South Africa.
In the Free State the average for a sectional property or full title property is R6,417 and R6,557, respectively.
The Western Cape is the province that has the highest average rent for sectional property and full title property for Q2 2024.
In the Western Cape, the average rent for a sectional property is R9,842 while the average rent for a full title property is R12,775.
According to the report, nationally, rental prices have escalated by 4.29% for Q2 2024, down from the previous quarter’s 4.87%.
Gauteng has seen three consecutive quarters of slower rental value growth. Rental escalations made a recovery in the first two quarters of 2023 but have since been on a downward trajectory with rentals in the province slowing to 3.32%.
In the Western Cape, the rental escalation trajectory has reached a turning point, according to the report.
After strong rental escalations at 7.10% in the first quarter for the Western Cape, escalations have now slowed to 6.98% in the second quarter.
KwaZulu-Natal showed a slight uptick in rental escalations in the first quarter (4.86%) comparison to 4.97% in the second quarter.
The data in the report shows that escalations will remain at this level while vacancies continue to be high. This has forced investors to focus on collecting rentals on time a priority.
In the Eastern Cape, rentals increased more rapidly quarter on quarter with rental growth jumping from 4.16% in Q4 2023 to 4.41% in Q1 2024 to 4.7% in Q2 2024.
The other provinces which have smaller tenant populations has a combined, rental escalations of 5.23%, marginally lower from the previous quarter.
Property investors have remained hopeful that rental growth would continue on an upward trend to keep up with rising costs.
With a price-sensitive market investors are looking to good-quality tenants rather than aggressive rental growth with their efforts focused on operational efficiencies and accuracy to keep showing returns, according to the report.
IOL Property