- Factors that determine the demand and what rental will be market related are usually determined by (but not limited to) the following factors:
• Accessible amenities (e.g. shopping centers, schools, main roads, etc.)
• Security and safety (tenants want to be assured that their safety needs will be strictly attended to).
• General management (strict management of the scheme is crucial in determining the value of the property in years to come)
• Water and electricity (a prepaid electrical metering system is an advantage, and often a criteria when a tenant is looking for a property to rent).
• Properties that allow pets are quite in demand and often a tenant will be willing to pay a little more for a property that allows pets)
• Parking facilities for the tenants, and especially extra parking for the larger units i.e. 2 and 3 bedroom units).
Roderick Park will be ideally situated with various amenities surrounding the property.
There is a shopping centre nearby (Northridge Mall is approximately 2 km via Gladstone Road, whilst smaller centres is less than 1km), along with 3 schools (Kruitberg primary School, Navalsig High School and Sentraal Primary School).
From Roderick Park there is easy access to the N1, as well as the airport. A Brent Oil filling station is also nearby, with a fast food store.
Market Research was done on the property, the location thereof, as well as the need for rental properties. The following conclusions were made:
• There is a high demand currently for properties for sale. As explained by Adv. Hansie Taljaard, there is a clock on properties which determines the effect of rentals and sales.
The clock is based on an 8 year cycle, which includes a boom of two years. We are currently in the in the phase where it is more lucrative to purchase a property, rather than renting it. This statement is based on average rentals for the past eight (8) months, being the lowest in the past six (6) years. If the cycle theory is to be correct, will it end by the end of 2018. We are currently in the upward curve, therefore will we reach maximum potential at 2022.
• As there are more students entering Bloemfontein, the demand for property has risen in the vicinity of tertiary institutions. Both CUT and UOFS have started developing their own complexes next to the institutions to accommodate this high demand. This has a negative effect on properties which have been converted to student housing. As a result hereof, there is now a need for the working class to move away from the central student districts.
• It was noted in the proposal documents that only two bedroom units will be constructed, however, the need for bachelors, 1 bedroom and 3 bedroom units also exist. Examples hereof will be provided herein to state this statement.
• It has also being noted that tenants tend to rent more easily in property which have been renovated and/or developed. Various buildings within Bloemfontein have recently been renovated and successfully occupied within a couple of days. Examples hereof will also be provided.
• Access and distance from within the city limits also plays a huge factor for tenants when considering where to rent. As the property has two access points, the city can be reached within minutes, whilst access to Northridge mall can be taken through Bayswater via Gladstone Road. The N1 Northbound can also be accessed through Raymond Mhlamba Road, whilst the airport is in near proximity.
Property currently managed within close proximity
Based on properties currently managed by National Real Estate’s Residential Letting Department, the following figures are applicable. The properties are as follows:
Panorama Park is a complex with 140 simplex units situated across Raymand Mhlamba Road (Tielman Roos Road) opposite Roderick Park. The units are the following sizes and rent for the following amounts:
63 sq – R4700,00 – R5200,00 p.m.
64 sq – R4700,00 – R5300,00 p.m.
85 sq – R5600,00 – R6500,00 p.m.
All the available units at Panorama Park are currently occupied. About 92% of the property consists of the 63 and 64 square meters. It is important to note that there is only one access point to Panorama Park from the city, whilst Roderick Park has two. Panorama Park Units
Park Avenue is also situated in the Northern Suburbs and is about 600 meters from Roderick Park (as the crow flies) and consists of 316 units. Park Avenue consists of three “styles”, being Farm Style Simplexes, Victorian Style Simplexes and Contemporary Stacked Simplexes and Duplexes. The Contemporary Stacked Simplexes and Duplexes rent out for the following amounts (this is the building style as gathered from the Developer):
57 sq – R 5800,00 p.m.
63 sq – R 6000,00 p.m.
74 sq – R 6400,00 p.m.
Maisonettes (Stacked Simplexes, all being two-bedroom units)
57 sq ground floor – R6000,00 p.m.
57 sq first floor – R6000,00 p.m.
The abovementioned figures are based on our rental amounts and reflects an average, but there are Duplexes that rent in excess of R6000,00 per month, whilst the Maisonettes rent in excess of R6000-00, subject to the owner’s discretion. 95% of these units are occupied.
It is the opinion of National Real Estate that the development will be a success by end of 2020, beginning of 2021, as we predict an increase in rental property demand. As Bloemfontein is ever expanding its borders, the complex will be ideally situated by the time that this area is developed. National Real Estate are currently successfully managing and renting property in remote locations outside of Bloemfontein, for example Riversdale, which is situated on the Maselspoort Road (approximately 1 km from the Air Force Base), and these units are also fully occupied.
With the correct company managing the scheme, installation of utilities and ensuring that the complex is secure, will it be a very good investment for anyone.
The units will be 84 and 101 square meters. The rental to be achieved will be between R6 500-00 and R8 500-00 per month.
The time of the year plays an important role when determining the rental criteria, i.e. high and low demand for rentals. The danger is always that the property will not be fully let, depending on the demand for rental. We are
also in a pandemic, which also contributes to achievable rentals.
There are numerous properties in the area, but none with the same or similar entry to the complex. The number of amenities around the complex will also make it attractive to any prospective tenant.
Own to Rent today – It’s a Great Investment
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