Which properties attract the best tenants?
Property Rental News: Which rental properties attract tenants with the best payment behavior?
If you are considering buying a property for investment purposes in South Africa, with the intention to rent it out, one of your first consideration would be to find a property that will attract lots of potential tenants, with good payment behaviours.
The Rental Payment Monitor, a report by the TPN Credit Bureau suggests that the best tenants are found in the Eastern and Western Cape, for properties with monthly rentals between R3 000 and R7 000.
According to the report tenants who pay between R3 000 and R7 000 per month toward their rent are the least likely to miss a payment.
On average, 82 percent of tenants in this rental bracket were in good standing, with 71 percent of them paying on time.
The TPN Credit Bureau considers tenants to be in good standing if their rental is paid on time or even on the last day of the month.
Meanwhile, the data has also shown that properties rentals at the highest bracket (R12 000 or more) are showing signs of trouble.
As much as 21% of tenants in this bracket made no payments toward their monthly rental during the final quarter of 2009.
Key Payment Behaviour stats:
21% – Tenants, paying over R12 000, who made no payments toward their monthly rental.
14% – Tenants, paying under R3 000, who made no payments toward their monthly rental.
14% – Tenants, paying between R7 000 and R12 000, who made no payments toward their monthly rental.
11% – Tenants, paying between R3 000 and R7000, who made no payments toward their monthly rental.
Nationally:
76% – Tenants living in Gauteng, who are in good standing
85% – Tenants living in Western Cape, who are in good standing
86% – Tenants living in Eastern Cape, who are in good standing