Real Estate Investor Magazine South Africa December - January 2014 | Page 30

GETTING STARTED

BY TANYA VAN BUUREN

Student Housing Is Hot
Invest in the future, today

E

ver y yea r t housa nds of st udents
from all over the country stream to
Stellenbosch, Pretoria, Potchefstroom
and Bloemfontein to embark on their academic
journey. Although these universities all have
residences that can accommodate students,
the demand for accommodation far exceeds
the supply, resulting in thousands of students
having to find alternative accommodation each
year.
Seeff ’s agents all agree that this is one of the
main reasons that parents and investors choose
to invest in the student market, but finding
the right property in your price range requires
a lot of homework. Prospective buyers need to
undertake comprehensive research on specific
areas and apartment blocks to narrow down
their search before entering the market. Jacques
Becker, Seeff agent in Stellenbosch, says that
the student housing market in Stellenbosch
has always been a very captive market and
that investing in property here it is a very good
investment, especially when a property is close
to campus.
“ Two bed room apa r t ments/ houses in
Stellenbosch are especially popular amongst
parents who buy property for their student
children for the duration of their studies,
because the second bedroom can be rented out
to someone else, giving the parent an extra
income. In the case of investors other criteria
also play a role. Rental income versus price and
the growth potential of the property are major
considerations. Usually the more bedrooms,
30

the better the income versus price is if you can
manage to keep the property occupied at all
times.
Educated buyers all agree that the property
hot spot in Stellenbosch is found in the area
bet ween the borders of Banghoek Road,
Die Laan, Andringa Street and Cluver/
Marais Streets. “This area is more expensive
and sought-after because of proximity to the
campus. In general owners can expect to get a
better growth here. There are, however, good
apartment blocks outside this area, and also
blocks on campus that have a slower growth.
Thus doing your homework with the correct
information from the right agent is of the
utmost importance.
Growth in this highly sought-after area,
which is in close proximity to classes, can
also be attributed to the scarcity of wellpriced property, where buyers who have the
means to buy here are often unwilling to
compromise on position or don’t have the
time to wait for the right property. They then
end up paying a premium and this premium
price ultimately becomes the new market
value, hence the growth,” says Becker. Becker
concludes that property prices in Stellenbosch
tend to drop signif icantly the further you
move away from campus. Seeff Pretoria East
agent, Pieter Bezuidenhout, says that due to
the shortage of land for new developments in
the Hatfield/Hillcrest area in Pretoria the
demand for student housing in close proximity
to the university of Pretoria has reached an

December January 2013/4 SA Real Estate Investor

all-time high and the demand is consistently
outstripping the supply by a large margin.
“As a result, prices remain high and will
remain so for the immediate future. This is
especially true in the case of two-bedroom
apartments and bachelor flats that are within
walking distance from the university. These
two categories range in price from about R400
000 to R1,1 million taking into consideration
that the average rent for a bachelor flat is about
R3800 per month, whi ?RGv?&VG&????@?Gv?&F?&???'F?V?Bv???6?7B??F???rW?F?#cW"W'6??6?&??rW"???F??( ?6?0?&W?V?FV???WB??6??6R&????G?F?6?W2vV?W&????W0?f?"v??B?B6fR??fW7F?V?B??F??Vv?F?W&R?0?F?vW"???fW"??fW7F??r?b??R&R??B6&VgV??b??RV?FW"F?R?&?WBW&V?2???fW7F?"??'W???r&6?V??"f?B??F?R#CF?#C#?&?vR?2v??B?F????&6?V??"f?G2&P?fW'??V?"v?F???fW7F?'2f?"&V6??27V6??2??r???FV??6R???v?&V?F?2???G&?6fW ?GWF?W2?Bv??B&WGW&?????W"??fW7F?V?B??&W?V?FV???WBv&?2v??7B??fW7F??p?????B??W6W2???&FW"F?GW&?F?V???F??7GVFV?B6???V?W2?( ?f????v??rF??2&?WFP?W7V??FV??G2??B???&?6????v?????FV??6R?BFWFW&??&F????bF?R&?W'G?( ???&W?V?FV???WB6??6?VFW2F?BGW?&W''??@??V????&?G2??????7&W7B?B6?WF?7G&VW@????Ff?V?B&RF?R??7B6?Vv?B?gFW"7G&VWG2???F?W6RGv?&V2??R?6?FG2F?B?N( ?2W?G&V?V??wwr?&V??r?6?????