Many tenant could be paying more monthly rent than they would be paying on a bond for their own property.
With interest rates so low, some properties under R1.5 million are now 25% percent cheaper to buy than to rent.
“They will also offer a 10% return on investment,” says global property expert, Toni Enderli.
Enderli says the current rates – the lowest in 50 years – combined with transfer duty relief, higher loan rate approvals and attractive entry-level offerings mean selected entry-level properties, where units start from under R700 000, will save them 25% on what they are paying for rent.
“This is the best time in decades to buy into this affordable housing market. Tenants can now easily become owners with bond repayments at secure developments like Cape Town’s Ihlathi gated community starting from R5 500. This is compared to R7 500 a month to rent.”
In addition, the development is located on a green belt in Parklands, one of the country’s fastest growing and best-positioned suburbs.
Enderli, who heads up Realtor of Excellence and who studies property trends in South Africa and Europe, says 80% of all homes sold in 2020 were under R1.5m. Demand was so high that Ihlathi’s first phase (102 units) sold out within months and similar demand is expected for the next 98 units available in phase two.
New owners can take occupation from June 2021.
Units in this Green Building Council-certified, eco-friendly development start at R699 999 for a one-bedroom and R799 999 for a two-bedroom.
A three-bedroom duplex is priced from R1 249 999.
Enderli explains that Ihlathi, which means “forest”, was the ninth entry-level gated community in Parklands by International Housing Solutions (IHS), a global private equity fund focused on affordable housing.
IHS’s SA managing director Rob Wesselo says demand in Parklands has soared because it is 20km from the CBD and close to amenities such as schools, a new international university, malls, MyCiTi bus routes, work opportunities and the extensive coastline.
“In addition, Ihlathi offers attractive ‘green’ features, including solar PV geysers – up to 20% saving on energy and water, fibre-ready internet and 24-hour security.”
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Units in phase two of the Ihlathi development in Parklands will become available from the middle of the year.
Ihlathi offers green features, including solar PV geysers, fibre-ready internet and 24-hour security.