The rental market in certain upmarket Johannesburg northern suburbs estates is more robust than ever, making properties in these areas a prize investment that can deliver sound returns.
This home in Fourways Gardens is available for rent through Pam Golding Properties for R45 000 per month unfurnished or R55 000 fully furnished.
This is according to Jason Shaw, manager of the Fourways/Dainfern office of Pam Golding Properties (PGP), and is at least partly attributable to the strong demand from corporations, especially multi-national companies doing business in South Africa.
When moving to a foreign country the ability of high level personnel and their families to acclimatise to the new environment is often determined by whether or not they can fit into the community in which they will be living. According to Shaw, for expatriates a sense of belonging is rated high in importance along with security, comfort and accessibility to amenities.
“Facilities such as good schools in close proximity, a club house, tennis courts and a golf course can go a long way in making a family feel at home, which is why these specific estates are proving popular with foreign and local tenants alike.”
Shaw says there are many multi-national companies doing business in South Africa seeking upmarket accommodation for their senior staff members for periods of between one to three years. Properties in estates like Dainfern, Fourways Gardens and Cedar Lakes are offering excellent returns to those landlords who have an understanding of this corporate market and its unique requirements. These homes generally represent a sound, long-term investment that is almost unequalled in today’s market, according to Shaw.
He says one advantage of letting to this market is that landlords and their agents deal with reputable companies that are financially solid and reliable. “This is most reassuring for those owners who wish to rent out their beautiful properties, many of which are acquired specifically for investment purposes.”
This home in Cedar Lakes is being rented out through Pam Golding Properties for R28 000 a month unfurnished – click here to view.
Shaw says some 90 percent of the residential properties being rented out by PGP in Dainfern are to companies, while in Fourways Gardens and Cedar Lakes this figure stands at approximately 50 percent. He notes that 30 percent of the properties in the three estates are purchased for the purposes of letting.
Security is as important as ever as foreign nationals seek to live in areas where they can feel secure, points out Shaw. “Many business people travel extensively and they want to know that they are able to leave their families at home without having to worry about their safety.”
While security is a priority for most expatriates, Shaw says they also prefer not to live with high walls, which divide them from their neighbours and the community. “These are families who want engage with their neighbours and who seek to meet new people. Social and sporting activities are also important to them and as such they tend to gravitate to estates that offer every conceivable amenity.”
Why don’t these companies buy their own homes? According to Shaw most corporates do not want to be tied to properties that their employees might not like. Renting allows staff members to find the home of their choice and they are able to use it for as long as they are working in South Africa.
While companies are prepared to pay a premium to rent suitable properties and the corporate market offers excellent opportunities for astute investors, Shaw does advise that the corporate market has very specific requirements that need to be met if landlords and property investors are seeking good returns. He points out that not all homes in popular estates are suitable for renting out to corporates.
He says properties need to be situated in the right areas and homes must be modern, well designed and spacious as well as having ample light and good safety features.
“Being so far from home, many expatriates like to be able to have their visiting friends and families stay over, so a home needs to have four or more bedrooms.”
Companies will also insist on homes having an alarm and an armed response service so that they are able to meet their legal obligations to keep their employees safe, he says.
Shaw identifies other important features for a home aimed at this market include:
- Under floor heatin
- Low maintenance indigenous gardens with automated irrigation
- Practical, good quality finishes
- Good quality tiles, which are attractive, durable and easy to maintain
- A swimming pool is important for our long, warm summers
- Curtains and upholstery that can easily be cleaned
It is important for property owners who are looking to rent their homes to corporates to find an agent who can partner them every step of the way, says Shaw, and it is essential that such an agent has expert knowledge of the market so that they are able to provide sound advice and guidance to the client. “The agency must also be able to offer a comprehensive service and assist the tenant, who is often completely new to the country, to settle into his or her new home.”
A property owner with the proper support can turn a home in one of these upmarket estates in the northern suburbs into a solid investment that will achieve sound returns on an ongoing basis, he says.