Industry boosts Delmas rental market

Extensive industrial development in and around Delmas in the Mpumalanga coal belt is opening up opportunities for investors in new rental units, according to Koos Pretorius, owner of the local RealNet franchise.

4 Bedroom House for sale in Delmas

“The fast pace of new industrial development, such as new mines and manufacturing facilities, is putting strain on the small existing pool of rental properties in Delmas, with contractors at the mines and staff at new facilities like the Sephaku cement plant that started operations at the beginning of this year, vying for accommodation for the duration of short contracts, and in the case of new employees, until they find suitable homes to buy," he says.
Local investors are now stepping into the breach and are increasingly buying up large stands which they subdivide to build between four and eight rental units, he says. And these units of between 180sqm and 235sqm are taken up by tenants at monthly rentals of between R4800 and R6600 as soon as they are released on to the market.
Building costs in the area now range between R4000 and R5000/sqm, depending on finishes, so units like this cost around R800 000 or R900 000 to build.
"And the trend is likely to continue for the foreseeable future due to additional commercial developments planned for the area, such as a casino and amusement park between Delmas and Bronkhorstspruit, as well as an industrial park to accommodate increasing demand for manufacturing facilities," Pretorius says.
Specialist area agent, Karin van Rooyen, adds that there is also great demand currently for three-bedroom family homes at rentals of between R5000 and R6500 per month. Although a fair proportion of contractors relocate their families to Delmas for the duration of contracts of between 18 and 24 months and rent family homes, many other contractors rent homes in the same category for teams of colleagues.
"Thus homes with three or four bedrooms can be rented to accommodate up to 12 residents, but in this case rentals are usually calculated per head, like a student commune. In most instances, these rates are around the R1000 per month mark, which allows landlords to achieve excellent returns," she says.
RealNet Delmas offers tenants who work long shifts additional services such as home cleaning and garden services at a small monthly fee. "This option is very popular among teams of contractors, who basically only eat and sleep on the premises and do not have time to maintain the property in terms of rental contracts," she says.
Meanwhile properties for sale are also in great demand and interest is very high in the R650 000 to R850 000 price range, but stock is extremely limited, she says. "Average sales prices are now between R900 000 and R1,2m and there is marked buyers' resistance above this level. Top properties with prices of up to R3,5m are, however, taken up on occasion by top-level mine managers and executives in the business sector with permanent employment contracts.”

  Comment on this Article

  Please login to post comments

Post to my facebook wall
Characters remaining

    Latest Property News
    • 22 Nov 2017
      The end of the year is fast approaching, and so are all the travellers, tourists and holidaymakers. For those who live near or own a property in a holiday-hotspot, the festive season also brings with it an abundance of short-term rental opportunities. Its a great way for property owners to make a few extra rand for their own holidays or to put towards their savings.
    • 21 Nov 2017
      The buying process is over, and the moving truck has delivered your household goods to your new property. Now it’s time to unpack and turn your new house into a home.
    • 21 Nov 2017
      When an offer to purchase a property is signed by both buyer and seller, this constitutes a binding agreement or “Deed of Sale” between the two parties. However, in most cases the “standard contract” might not be enough to cover all the specifics pertaining to the sale. The agreement may require some additions or alterations to clauses, which needs an expert hand in the drafting of such
    • 21 Nov 2017
      As more and more South Africans look to invest in property abroad, Spain is offering them one of the best deals in global real estate.
    • 20 Nov 2017
      Since 2012, sectional title complexes have been leading the South African property market, not only in terms of price growth, but sales volumes as well. Remaining relatively strong, even in the face of 2017’s political and economic turmoil, experts say this market segment could offer valuable insight into South Africans’ property purchase priorities.
    • 20 Nov 2017
      Regardless of whether you are purchasing your first start-up home, downsizing or moving in with roommates, finding ways to maximise small spaces can be a big advantage, says Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa.
    • 20 Nov 2017
      Property valued at approximately R1 billion is on High Street Auctions’ sales floor during the month of November, including the much-anticipated sale of the Tshwane Mayoral Residence and the land occupied by one of South Africa’s oldest operating gold mines.
    • 17 Nov 2017
      FWJK has announced the launch of its latest residential brand, the Lil’ Apple, which will be launched simultaneously in two developments in Cape Town and Umhlanga totaling 600 apartments. The Lil’ Apple is set to be a brand of FWJK’s New York style apartments which will be rolled out nationally.
    Subscribe to the MyProperty Newsletter

    Last Name  
    Email Address  
    Email Frequency
    Share this Page

    For Sale Property
    Rental Property
    More Options
    Connect with us