Tapping in to student accommodation demand

Cape Town is achieving some of the highest rental returns in the country, according to TPN.  The Mother City’s rental yields are at an annual escalation of 10%, whereas Johannesburg is only seeing an annual escalation of 3%.
“One of Cape Town’s biggest demands in the rental space is student accommodation,” says Natalie Muller, Regional Head of Rentals at Jawitz Properties in the Western Cape. “But a lot of landlords are cautious to rent out their properties to students and are thus missing out on the lucrative opportunity this market presents.”

Be it worry that students will wreak havoc at home or not be good for the monthly rent, there is a way for landlords to get past the fear and protect themselves.

“It is essential to bind the parents of the student to the student, so that all parties are liable for any defaults or destruction,” Muller says. “By doing this and signing the lease in both the parents’ and student’s names, landlords are automatically protected.”

Landlords can even request that certain clauses be added to the lease agreement – specifying no noise at certain hours, house rules and etiquette requirements. “And because the parents are bound, it is in their best interest to ensure their student child adheres to these rules.”

When it comes to making sure the rent is paid, the parents who may in fact be the ones paying rent anyway, are now certainly responsible for the rent to come in, as it is stated in writing. “They have co-signed the lease and are liable,” Muller adds.

While one can sign a contract at 18 years old constitutionally, it is unlikely that the majority of students have a sufficient credit rating, so the parents would be the ones who prove they qualify for a rental agreement or not.  If it is a two parent-family, however, have credit checks done on both of them before they sign the lease. “Don’t assume that just because one parent is solvent that the other one is too. It’s important to check all parties to protect yourself,” Muller says.

When signing the lease, also be sure the wording binds the occupier (the student) with the leaseholder (the parents). “This will become important should you need to serve notice,” Muller concludes.

  Comment on this Article

  Please login to post comments

Post to my facebook wall
Characters remaining

    Latest Property News
    • 22 Mar 2018
      Sustainability is currently a hot topic in the home and construction sector. In light of the progressing climate change and shrinking resources worldwide, it’s one of the most important issues to consider. Sustainable living is the practice of reducing your demand on natural resources by making sure that you replace what you use to the best of your ability.
    • 22 Mar 2018
      The 1% VAT increase which is set to take effect as of 1 April 2018 has set the country alight with many burning questions, most of which cannot be comprehensively answered by our knowledgeable friend Google.
    • 22 Mar 2018
      The picturesque and oft-misty town of Dullstroom in Mpumalanga belies its name. Judging by the rapidly increasing influx of weekend visitors, many of whom then look to acquire property here, it’s anything but dull, quips Anton Greeff, Pam Golding Properties area principal.
    • 20 Mar 2018
      Located close to the fast growing Fourways precinct, Dainfern continues to attract local and international interest from buyers seeking a secure lifestyle with affordable entry price of approximately R3 million.
    • 20 Mar 2018
      Property owners in the Durban CBD are addressing the affordability challenge that faces many prospective tenants in their area – and reconfiguring the inner city rental market in the process.
    • 20 Mar 2018
      One of the most misunderstood concepts in the process of selling a property is an exclusive or sole mandate.
    • 19 Mar 2018
      If a landlord opts to use a managing agent for the rental of his or her property, the inspection process can be easier as the agent is not emotionally involved and will certainly have concluded an in-depth inspection report in the interests of all parties.
    • 19 Mar 2018
      We all wish we could have the cheat sheet for selling a property – a simple Ctrl+Shift+C code that will magically secure an offer on your home in an instant. Though it is not possible to provide you with this cheat code (sadly, reality does not come with such perks), it is possible to provide you with a list of the most common blunders some of your neighbours have committed in their efforts to sell their homes
    Subscribe to the MyProperty Newsletter

    Last Name  
    Email Address  
    Email Frequency
    Share this Page

    For Sale Property
    Rental Property
    More Options
    Connect with us