Towns such as Paarl, Franschhoek, Stellenbosch, Wellington and Tulbagh have become popular ‘zoom towns’, attracting not just people from upcountry but also from the Cape metro looking to escape the city, according to Seeff Property Group.
They are also popular with semigration buyers from Gauteng as well as buyers moving out of the Cape Town metro and according to Seeff’s branches, this movement of people into the area has boosted demand for rental accommodation.
A zoom town is a community that experiences a significant population increase as remote work becomes more popular, especially in the wake of the Covid-19 pandemic. First coined in the US, it is also trending across South Africa.
The beautiful surroundings, access to the wine farms, fresh air and outdoor lifestyle is an attractive alternative to city living according to Seeff’s agents. This has had a good effect on the property market including the rental market with many renting or at least renting until they are ready to buy.
Charmaine Van Jaarsveld, a rental agent with Seeff Paarl said the market there is active for smaller properties such as flats in the price range from R4,000 to R7,500.
Boschenmeer Golf Estate, just outside the town is very popular with out-of-towners and semigration buyers. It is experiencing strong demand for rentals despite the higher prices ranging from R15,000 to R32,000 per month according to Lynn Giles, Seeff’s rental agent for the estate.
She said landlords have been accommodating to retain tenants and rates have come down by a drastic 25% while annual increases have been kept low at 3% to 5%.
Europeans who own property on the estate and have not been able to return for their usual holidays, have put their furnished properties in the rental market and have been quite negotiable on their rental prices.
There was a drastic exodus of tenants at the Southgate complex which usually attracts young professionals in the 25-45 year age group. The landlord, therefore, offered a “winter special” to entice tenants with the first-month rent free. Rental rates are around R9,300 per month, said Seeff.
Boschendal is also seeing demand for furnished, short-term rentals due to families moving to Paarl and want a ‘stopgap’ while exploring other options, said Giles. There are also requests from people who are renovating their homes and looking for a temporary home away from the chaos of a construction site.
Rental rates in Stellenbosch tend to be on the high side. Jana Heunis, a rental agent with Seeff Stellenbosch for the De Wijnlanden and Kelderhof Estates said demand is still fairly high and vacancy rates are low compared to other areas.
The most popular rental price bracket is between R15,000 and R25,000 per month. The best return on investment for rental property owners tend to be sectional titles in the case of Croydon Estate and De Wijnlanden. In Stellenbosch, high levies and property prices tend to impact the ROI, unless the property has been owned for a long time and is fully paid up.
Moira Atkinson a rental agent with Seeff Franschhoek says the rental market there is very active with huge demand and a scarcity of stock in the R8,000 to R14,000 per month range.
Most landlords have not escalated the rentals for this financial year to secure long-term paying tenants. Many Airbnb and Booking.com establishments are still looking to the long-term residential tenant market while they wait for tourism to bounce back.
The most popular price bracket in Franschhoek is between R8,000 to R12,000 for local and hospitality industry prospects. Tenants moving into the area from areas such as Gauteng to work remotely tend to pay between R15,000 to R25,000. International tenants looking for a long-term rental tend to pay between R25,000 and R50,000 per month.
The commercial market has escalated substantially with little traction except if it is a huge corporate prospect with the relevant financial backing, said Seeff.