Three compelling reasons to invest in rental property this year

Van der Merwe outlined three key reasons why 2025 is a strategic year for investing in rental properties:

Positive economic sentiment supports market growth

“The outcome of the national elections means that political uncertainty is no longer a major disruptor to the property market, and this is further strengthened by our more stable power supply,” stated Van der Merwe.

He pointed out that the current prime lending rate is at 11.0%, following a repo rate of 7.5% as determined by the South African Reserve Bank.

“Predictions for continued downward adjustments will lead to more advantageous financing rates for property investors, ultimately yielding better long-term returns.”

Major infrastructure developments boost property values

Amidst a wave of optimism, the government’s push towards public-private partnerships aims to stimulate infrastructure development, a move that could significantly enhance property values.

“Treasury’s decision to ease restrictions on public-private partnerships under R2 billion, effective from June, should catalyse significant upgrades to infrastructure,” van der Merwe explained.

The integration of schools, shopping centres, and recreational facilities—such as those proposed for the Renishaw Coastal Precinct, wherein Renishaw Hills serves as the first development—will help transform the area into a desirable rental location.

Growing demand for rental housing creates opportunities

As semigration trends see more people moving from inland regions to coastal hubs, particularly fuelled by the rise in hybrid and remote work models, areas like the KZN South Coast are reaping the benefits.

Van der Merwe indicated that the supply of new, high-quality housing in secure gated estates is failing to meet this surging demand.

“This presents a prime opportunity for investors to secure buy-to-let properties before prices peak,” he advised.

With average rental prices already on the rise in KwaZulu-Natal, this trend is set to continue.

IOL