Real Estate Investor Magazine South Africa July 2014 | Page 24

HOTSPOTS
Lephalale
The PayProp Rental Index tracks the rental averages
across provinces in South Africa and Limpopo has
topped this list over the past nine Index readings.
“From our first PayProp Rental Index in December
2011, we were amazed by the extremely high rentals
that have been achieved in the area. We were
particularly impressed by the town of Lephalale and
how it stood as an example of what happens when
industrial development comes to an area that does
not have adequate rental housing capacity – resulting
in off-the-charts rentals when compared to the rest
of the country,” Louw Liebenberg, CEO of PayProp.
“The growth in Limpopo seems to be halting, we are
seeing the first signs of a slow-down, with growth rates
dropping from 14.5% in Q2 2013 to just 4.4% at the
end of Q1 2014.” Nevertheless, Lephalale retains its top
spot on the board as the town with the highest rental
in South Africa.
Lower down on the list there has been minimal
movement, with most of the ‘usual suspects’ retaining their
position. There has, however, been a new entry, that of
Wierda Valley, with an average monthly rental of R8,837.

Source: Payprop
Johan du Plessis, Just Invest Co-CEO comments:
“We are also very excited about Lephalale (Ellisras) in
Limpopo which is one of the fastest growing towns in
South Africa and a property investment paradise.”
The town’s sudden development and growth can be
accredited to the Medupi Power Station, which is the
fourth-largest power station in the world. Another
driving factor for the economic boom is the high
percentage (50%) of South Africa’s coal reserves in
Ellisras, as well as the success of the R170 million
Lephalale Mall, constructed in November 2012.

High-performing areas
According to Just Invest, South Africa’s property industry
has experienced a steady increase of new investors entering
the market in the past 24 months, despite the bank’s
lending criteria being tightened.
In particular, properties within the R500,000 to
R700,000 price bracket is still very active both for
experienced investors adding to their portfolios, as well as
the influx of first-time investors entering the market, often
be purchasing their first property. High demand areas for
investment are reported by Just Invest to be metropolitan
areas such as Pretoria, Centurion and Midrand.
Another investment hotspot is Potchefstroom. This
academic city i