I’m always a big fan of buy-to-let opportunities and the steady, reliable source of silent income they can produce. There are of course some parts of the country and some times of year when this gets even more exciting and property owners can ditch monthly rentals in favour of renting out their properties per day. Think cultural and sporting events such as Grahamstown during the National Arts Festival, the Iron Man in Port Elizabeth, the Cape Argus, the 2010 Fifa World Cup, certain rugby tests, and of course the KZN coast and the Atlantic Seaboard during the festive season.
If you are considering buying to let with short term rentals in sectional title developments, always check the body corporate rules as these very often prohibit leases regarded as short term.
On to the Cape now, and its very busy short term rental market. With this year being just as busy as past years (and some sizeable property investments by locals as opposed to international buyers in the Cape recently) here’s some interesting news from Ruth Munitz, manager of Seeff SHORTSTAY.
“The last tourist season was the busiest on record. Cape Town Tourism reported a hike in visitor arrivals of 8,9% for the 2015 year with more than 4.6 million people visiting the city. More and more people now visit each year, especially over the October to April high season period and we expect this season to be as busy, if not busier than last year. Bookings for the season are in full swing and home owners and investors are advised to list sooner rather than later if they hope to capitalise on the summer tourist season.
While rental can range to well into the upper thousands per day for a top end property in Clifton or Camps Bay, two of the most popular areas, prices of course are dependent on factors such as sea views and proximity to the beach.
As a general guideline, property owners and investors can expect rental income of around R6000 to R8000 per day over the coming holiday season for a two- to three-bedroomed home with a view in Camps Bay. Luxury villas can range up to R20 000/R25 000 per day for a home with a pool and fabulous views.
Clifton bungalows and apartments should achieve on average about R23 000 to R35 000 per day over the high season period.
City Bowl apartments with two to three bedrooms, preferably with a view, can attract on average around R5000 to R7000 per day in season while a house with all the latest mod cons, a swimming pool and fabulous city views can achieve as much as R10 000 to R20 000 per day.
The peak period, between November and the end of March, tends to attract the highest rates. Out of season rates tend to drop by about 30%-40%.”
To maximize on good rental returns Munitz stresses the importance of using a good rental agent:
“One of the first things that a skilled agency can do is to ensure that the rental is pegged at the correct rate taking into account all relevant aspects to ensure maximum rental returns. There may also be simple things that the home owner can do to increase the marketability and rental returns of the property.
Good basic amenities such as satellite television, Wi-Fi and security are generally now a must for the short-term market. Don’t forget also that your guest will need to know how to operate various aspects of the property that you may not even think of. This includes for example how to reset Netflix, operate the Jacuzzi, what to do when the washing machine does not work and so on. A good rental agency can provide this service along with a concierge service similar to that on offer in guest houses and hotels, all adding to the guest experience and marketability of the property.
Good reviews drive bookings and will also increase the marketability and potential returns of your property.”
www.seeff.com, Ruth Munitz 076 222 2122 / 021 434 9175