Rental demand continues to soar in Richards BayRENTAL DEMAND
CONTINUES TO SOAR IN RICHARDS
BAY
The KwaZulu-Natal
city of Richards Bay is home to South Africa’s premier
bulk port. Built in 1976 for the export of coal, it has since expanded into
other bulk and breakbulk cargoes.
Richard's Bay was founded at the end of the
19th century as a fishing village. In 1976, the harbour was dredged deeply
enough to make it a real seaport. It quickly grew to become the second largest
port in South Africa and
today around 1700 vessels are dispatched here annually, which amounts to around
55% of South Africa's
total sea freight. The port specialises in export goods, mainly raw materials
such as steel and coal, with the coal terminal processing an annual volume of
68 million tons.
The port has attracted big investment and Richards Bay boasts huge industrial structures. Most
of South Africa’s
aluminium is produced here as is 25% of the world’s supply of titanium,
zirkonium, rutile and other minerals.
It comes as no surprise then that demand
for rental properties in Richard's Bay outstrips supply by quite a margin. Trudy
van der Vlies, Broker/Owner of RE/MAX Marine which operates in the northern KwaZulu-Natal areas of Richards
Bay and surrounding areas of Empangeni,
Kwambonambi, Esikhawini and Ngwelezane, says that Richards Bay
is often described as an industrial holiday resort.She says most of the area’s main rental
income is from contractors who work at the harbour or industrial firms
operating in the vicinity.
Van der Vlies reports a noticeable increase
in rental demand here, which she says is mainly being driven by the new
contracts awarded through companies operating in the area coupled with the
ongoing upgrade of the harbour.
Lena Eloff, the RE/MAX Marine rental
specialist in Richards Bay, reported a busy 2010 in terms of rental agreements,
which she said mainly came from the middle class group that rent properties
priced between R5 000 and R7 000 per month.
These tenants are now looking for more
affordability without compromising on quality, while landlords looking for
increases in rental amounts.
While Eloff says that she is current only
signing between two and three lease agreements per day, which is slow for the
area, she says there is a steady influx which bodes well. Eloff, who usually
concludes between four and five lease agreements per day, anticipates the
market will pick up by March, which is usually the busiest month.
A three-bedroom home in a security complex can
earn a monthly rental of around R8 000, while free-standing houses can be
rented for between R5 000 and R9 500 per month, although there are a few exceptions
of exclusive properties with excellent security which rent for between R10 000
and R20 000 per month.
Van der Vlies says that some companies cut
hours or reduced packages last year in light of the recession, which had an
impact on the rental market, but she says this is now starting to pick up
again. “We are anticipating a big influx of people to Richards Bay
as the groundwork for the harbour upgrade is nearly finished, which means that
a range of specialist contractors will now be employed for the next phase of
the project.”
On the leisure rental side, van der Vlies
says that the December holiday rental figures for the area reflected a whopping
95% increase on 2009’s figures in terms of volume. During the Easter season, Richards Bay holiday accommodation is usually
always fully booked. Currently is it 90% full.
Says Adrian Goslett, CEO of RE/MAX of
Southern Africa: “Richards
Bay will continue to be a
growth area for the property market, and with rental demand outstripping
supply, there are some sound opportunities for property investors.”For more information contact RE/MAX Marine on 035 789 4171 Comments (0) 08.02.2011. 08:43
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