[imagesource: SA Venues]

Each quarter, credit bureau TPN compiles a Vacancy Survey, showing how many properties are currently sitting empty.

If you live on the Atlantic Seaboard, and things seem a little quiet of late, consider that a staggering 24,4% of properties (basically one in four) is standing vacant.

That makes it the worst-performing area surveyed, and vacancies have doubled since the third quarter, due in large part to limited international travel and affordability.

It’s not just the Cape coastline that is suffering, with a steady increase in vacancies across the country over the past two years.

The fourth quarter (Q4) number in 2019 was 8,97%, reports Moneyweb, and we’re now sitting at 12,91% in 2020’s Q4:

Vacancies are elevated at the low- as well as the luxury end of the market. In the sub-R4 500 a month range, vacancies are as high as 16%…

But it is the luxury market where the real pain is being felt.

According to the survey, one in five (20.65%) rentals above R25 000 per month sit vacant. In Q1 of last year, this figure was 16%.

In the greater Sandton area, vacancy rates sit as high as 22,4%, which is an increase of 3,2% since Q3.

According to TPN MD Michelle Dickens, this is “hardly unexpected as tenants continue to downscale looking for more affordable rentals”.

Basically, if you’re a buy-to-let landlord, these are horrific numbers.

Moneyweb has compiled a Q3 and Q4 comparison table here, but let’s look at the areas which are above the national average:

Image: Moneyweb

Then again, given what we’ve discussed above, now might be a decent time to make a cheeky offer on a long-term rental.

Seth, who used to dabble in rentals along the Atlantic Seaboard, reckons you should start with a discount of around 25%.

On a R50 00 a month rental, that works out at R37 500, which is a nice little saving.

On a R55 000 a month rental, like this four-bedroom house in Camps Bay, that works out at R41 250

If you really want to push the boat out, here’s a three-bedroom house in the area for R30 000 a month, which Seth reckons you start out offering R20 000 a month for. Failing that, if you have cash on hand, you could offer a six-month upfront payment of R120 000.

I don’t have a horse in this race, but as long as everybody comes out better off than when they started, right?

[source:moneyweb]