TRAVEL BAN CREATES NEW TRENDS IN RENTAL MARKET
The travel ban has placed many travellers in precarious living situations, especially those who had plans to emigrate just before the lockdown started. This has led to new trends in the rental market, with fully-furnished, medium-term rentals becoming increasingly popular and Airbnb homes moving to the long-term rental market to avoid vacancies.
Regional Director and CEO of RE/MAX of Southern Africa, Adrian Goslett, attributes the cause for these changes to a new type of temporary tenant that has emerged as a result of the travel ban; namely, the interrupted emigrant who needs a place to stay until he/she can begin their new life abroad. “This has increased the demand for fully-furnished, medium- to long-term rentals for the time being or until such a time when emigration plans can be realised,” Goslett notes.
Elaborating on the trend, Jenny de Necker, Broker/Owner of RE/MAX All Stars operating in Alberton and Germiston in Gauteng, explains that there has been an increase in the fully furnished market in their areas. “Many of our clients who sold their properties to emigrate and had the sale registered just before or during the lockdown were left stranded. They had all the plans to travel abroad and these where placed on hold when flights were cancelled or postponed. Many who were renting their homes on Airbnb have switched over to long-term rentals to accommodate those that are stranded here, with all their belongings already shipped to their new homes. In fact, many bed and breakfast guesthouses are also giving their clients a cheaper rate if they sign for a longer period. Clients may get lucky with a breakfast included as well,” de Necker explains.
In these areas, Nadia Aucamp, Broker/Manager of RE/MAX All Stars, notes that fully furnished rentals are preferred by families with young children where the parents are in their 40s as well as by young professionals. “The unfurnished rentals are definitely the most popular, although there has been a high demand in furnished units that offer Wi-Fi, water and lights, as well as DSTV / Netflix / Showmax options, during the lockdown period,” she explains.
Similar changes have emerged in KZN. Before the travel ban, Kim Peacock, Broker/Owner of RE/MAX Dolphin Realtors, explains that the short-term letting platform, Airbnb, was becoming more popular on the North Coast, with more people considering holiday rentals for their investment properties. “The lack of hotels on the North Coast, combined with it being a popular destination for young families and its proximity to the airport, is adding to the success of properties listed on Airbnb. One-, two-, three- and four-bedroom units closer to the beach are especially popular for this option,” she explains.
This makes it likely that Airbnb will regain its popularity in the area once people begin to travel again. As things stand, Peacock explains that freestanding properties and two-bedroom apartments that aren’t on the beach are yielding the highest returns along the North Coast.
In the Northern Suburbs of Cape Town, Caron Leslie, Broker/Owner of RE/MAX Property Associates, explains that those who were renting their homes on Airbnb are now looking to get long-term tenants to occupy their properties rather than having the home stand vacant. “Landlords are also having to reduce monthly rental amounts considerably to attract and hold onto tenants. Things are quite erratic in the rental market at present and it’s far too early to predict what further impact COVID-19 will have on the rental market in our areas, so it remains to be seen what trends will emerge post-lockdown,” she explains.
Goslett agrees with her sentiments, adding that landlords and investors would be wise to keep in contact with a local real estate practitioner to keep up to date with the latest trends and avoid having their homes stand vacant. “The advice of a real estate expert can be invaluable in this regard,” he concludes.