Cape Town rental prices skyrocket
Cape Town - Prices for rental accommodation in Cape Town have continued to soar and are now nearly double compared with just seven years ago.
Figures released by credit bureau TPN, which vets the credit records of tenants who stay in rental properties, disclosed that the average rent for a one-bedroom apartment in the Mother City was around R7 000, more than double what the average South African earns a month.
“The Western Cape has the highest provincial average rent of R7 463 per month,” said TPN managing director Michelle Dickens.
While there had been a slow growth of tenants who were able to afford rent in the R7 000 to R12 000 per month bracket, close to 80% of tenants on a national level were paying below R7 000, Dickens said.
According to TPN, in 2010 the average cost of rent in the Western Cape was just under R4 700.
Since the last quarter of 2015, the percentage of rent increases in the Western Cape and North West remained in the double digits, while over the same period the percentage of rent increases in Gauteng remained below 5%.
“The most common misconception is that the standard rental escalation is 10% across the country. According to TPN data, the highest the national escalation rate has ever been is 9.35% which was seen in the third quarter of 2013,” Dickens said.
“Since then, there has been a steady national decline. Rental increases per year are dependent on the suburb and this is based on the fact that supply and demand is different in each area. The latest escalation figures are; National: 4.25%; Gauteng: 4.03%, KZN: 4.14% and the Western Cape: 13.15%.”
Asked about the possibility of regulating rental prices, Dickens explained there had been several attempts and all had proved fruitless.
“The Rent Control Act was repealed when the Rental Housing Act was promulgated in 1999.
It was set at 10% at the time. Interestingly, rent control was once again added into the Rental Housing Amendment Act but then removed in the final draft version of the act which has now been finalised by Parliament and is expected to come into force at any time.
Global database Numbeo suggested that rent prices in Cape Town were more than 20% higher than Joburg.