Should you buy or rent in South Africa right now?

A question which often arises is ‘should I rent or should I buy?’

This is obviously a very broad and potentially multifaceted question but factors that influence this decision can often include the individual’s personal financial circumstances – in other words, individuals decide to rent because they cannot afford to buy.

In addition, there may be other personal influencers such as employment status and prospects, family composition, lifestyle preferences, hobbies and activities that play a role, said Dr Andrew Golding, CE of the Pam Golding Property group.

“Generally speaking, within South Africa, there is a strong culture of owning and the desire to own one’s own home both from an investment as well as a lifestyle perspective, and so this continues to be the dominant trend,” he said.

However, Golding said that in recent years the rental market has benefitted from the ever-increasing number of people who are unable to buy homes for whatever reason and this market remains very active.

This has been further fuelled by a younger generation of singles, couples and families who are financially not yet in a position – or able to raise sufficient finance – to purchase their first home, he noted.

He added that other perceived advantages of renting include the flexibility and easier mobility that renting offers, in being ‘locked into’ a property for a relatively short period of time.

“It’s essentially a question of one’s own financial situation and requirements rather than a case of one versus the other,” said Golding.

“If you can afford it then it is certainly preferable to purchase your own home as this has always proven to be a sound medium to long term investment – and remains so.

“This is despite the fact that there may be some valleys as well as peaks in the capital growth of the property along the way, depending on economic trends, the desirability of the property and its location, and so on.

“Added to this you would immediately be able to start enjoying all the lifestyle and other benefits of owning your own home, even if it really only starts to appreciate in value in six months to a year or more from an investment perspective,” he said.

In the current market

Golding reiterated that in any market  it does depend on individual circumstances, and there are very good arguments for both renting and buying.

Renting does not incur additional expenses such as rates and taxes, maintenance and other related expenses that the owner has,he said. However, owning property is an investment into the future as the property will gain capital growth year-on-year.

“It is very important to make sure that you do proper homework on an area, before committing to renting or buying.”

According to Golding, some of the factors to consider include:

  • accessibility to amenities and place of work;
  • aeeding areas for schools;
  • security in the area;
  • the potential growth opportunity of the property – in other words, will the property’s value increase year-on-year.

“The old saying that it is better to purchase the cheapest house in an expensive suburb than the most expensive property in a lesser area, remains true,” Golding added.

“Always make sure that you do not over extend yourself when making a property decision, the rental on a property will increase year-on-year and if you need to rent for an extended period, it may mean that you will have to move every year.

“In the instance of a bond, the interest rate may increase and/or the rates and taxes, insurances and other associated costs with owning a home.”


Read: 3 new property laws the ANC wants to introduce alongside land expropriation: report

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