The average rent in every province in South Africa – with one now over R10,000
While rental growth has slowed, rentals have continued to increase, with the Western Cape being the only province with an average rental price of over R10,000.
In the previous PayProp Rental Index, it was reported that quarterly rental growth had slowed after eight quarters, and it was surmised that it could be the start of a plateau.
In the event, rental growth entered a period of sustained year-on-year decreases in recent months – slowing to 4.2% (January), 3.8% (February) and 3.6% (March).
That has produced a quarterly average of 3.8% – the lowest quarterly increase since Q4 2022, suggesting that the post-pandemic rental growth recovery is well and truly over.
“While this lagged behind inflation, it is still a healthier growth rate than in the corresponding quarters in 2021 and 2022,’ it said.
The average rent in South Africa stood at R8,654 in Q1 2024, just R301 more than a year earlier.
PayProp has observed that the distribution of rentals has remained relatively stable nationwide over the past year. There has been a slight decrease in the R2,500 to R5,000 and R5,000 to R7,500 brackets and an increase in the higher brackets.
This is most likely due to rental increases causing properties to move into higher price brackets.
Provincially
The rental growth in the North West decreased slightly from last quarter’s double-digit increase to 9.8%, but it still remained the highest in South Africa for the fourth consecutive quarter.
However, the average North West rent reached R6,301, still the lowest of any province.
Rents grew by 9.1% year on year in the Free State, the second fastest of any province. The average rent in the province was R6,927—R579 more than a year earlier.
The Eastern Cape once again returned the third-fastest rental growth of any province, although this quarter’s 5.6% year-on-year growth was slower than Q4 2023’s 7.3%.
The average rent in the province now stands at R7,021, still the third lowest in the country but R371 more than a year previously.
The Western Cape experienced below-average rental growth for most of 2023.
However, in Q1 2024, rents increased by 4.3% year-on-year, surpassing the national average of 3.8% and the fifth highest in the country.
Average rents in the Western Cape remain the highest in the country at R10,300 – and thanks to sluggish growth in the Northern Cape, they are now more than R1,000 ahead of the nearest competitor.
In the Western Cape, the three most expensive brackets have more rental properties compared to any other province.
The R2,500 to R5,000 bracket is much smaller, accounting for just 5.1% of rental properties, compared to the national average of 16.2%.
Over the past year, there has been a shift towards more rental properties in the upper brackets. The R5,000 to R7,500 bracket decreased from 29.8% to 22.7%, and the R7,500 to R10,000 bracket is now the largest at 26.7% of all rentals.
Additionally, 16.5% of properties now fall in the R15,000+ bracket, compared to 10.1% nationally.
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