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As the economy opens further, allowing businesses that were formerly closed during alert levels 5 through 3 to resume operations, the fact remains that the damage has been done, and it will take some time to regroup and rebuild.

Salaries were cut and jobs were lost, along with revenue, placing us in a worse place than before the pandemic, when we were already in a recession.

As economic hardships grow, however, so does the cost of living, including the price of accommodation in major cities.

As the latest PayProp Rental Index reports, rental growth stands at 3,2% year-on-year.

This conflicts with the current economic crisis.

Lockdown and the current restrictions on movement have hit the property industry particularly hard. Tenants are unable to move and struggling to pay their rent, and sales agents cannot finalise sales or earn commission.

BusinessTech looked into recently released data published by jobs listing website Adzuna, which analysed average salary data and compared it to the average property value in the country’s city centres.

These average salaries are based off listings on Adzuna itself, rather than across the board, to be clear, or else the salaries would be far, far lower.

Taking into account the percentage of the average salary spent on rent, here are the most expensive cities to live in, in South Africa:

Cape Town

• Average Rent: R10 000
• Average Salary: R38 000
• Percentage of Salary Spent On Rent: 27%

Durban

• Average Rent: R7 500
• Average Salary: R31 000
• Percentage of Salary Spent On Rent: 24%

Johannesburg

• Average Rent: R8 000
• Average Salary: R37 000
• Percentage of Salary Spent On Rent: 20%

Port Elizabeth

• Average Rent: R5 000
• Average Salary: R28 000
• Percentage of Salary Spent On Rent: 20%

Kimberley

• Average Rent: R4 500
• Average Salary: R22 000
• Percentage of Salary Spent On Rent: 20%

Despite higher salaries, Cape Town remains the most expensive city in which to rent property, with renters dropping as much as 27% of their salaries on a place to live.

And, as Jesse Green, country manager for Adzuna South Africa, “rental costs within [Cape Town’s] city’s centre are even more expensive and can easily demand up to 35% of a renter’s monthly earnings.”

On the other end of the spectrum, cities like Pretoria, with an average rental price of R6 500, an average salary of R33 000, and 19% of that going to rent, provide great value for renters.

Bloemfontein comes in with the most value for money, with the average rent sitting pretty at R4 500, and an average salary of R30 000, with only 15% of that going to rent.

Sorry, but I’ve lived in Bloem. It’s not worth it.

Then again, is it worth losing 35% of one’s salary to live in the CBD?

I’ll have to think about that one.

[source:businesstech&payprop]