Real Estate Investor Magazine South Africa May/June 2019 | Page 25

UNITED KINGDOM
RESIDENTIAL
Older tenants are the ideal tenants
for landlords - even though they
typically have higher levels of
debt, they also have the highest
credit scores, according to the
PayProp Rental Index. PayProp
collects transactional data and is
the largest processor of residen-
tial letting transactions in South
Africa.
According to the Index, tenants
between the ages of 50-59 have
the best scores, due to many
factors including the discipline
and commitment they display in
While the weak economy has been
a major boost for the rental market
as affordability or an inability to
buy drive more people to rent,
Samuel Seeff, chairman Seeff
Property Group says that there are
still concerns about high landlord
expectations in terms of rental
returns and escalations. Generally,
while the rental market is seeing
Amdec Group’s latest develop-
ment, The Yacht Club valued at
R1.5 billion, includes 170 luxury
residential apartments, 6 000m2
of premium-grade office space
spanning two levels, and Africa’s
first AC Hotel by Marriott, has
been sold out bringing significant
investor returns.
The Amdec Group has a 30-year
track record of developing and
managing world-class mixed-use
debt repayments. At the other end
of the spectrum, the lowest levels
of debt were recorded for those
under the age of 30. However, this
age group was also found to have
the lowest credit scores.
‘High levels of debt do not neces-
sarily mean that a tenant is high
risk. Landlords should factor this
in when they are presented with a
breakdown of a potential tenant’s
repayment commitments,’ says
Johette Smuts, Head of data and
analytics at PayProp.
better growth at around 4-5%,
this is still below the 2017 average
according to the PayProp Rental
Index. The index also shows that
the consumer rent-to-income ratio
is under pressure, and Seeff says
that in such a climate looking after
good tenants should top looking
for quick wins with high rentals.
precincts, including the iconic
Melrose Arch in Johannesburg.
Their confidence in the economic
future of South Africa, and in par-
ticular that of the Cape Town CBD,
will see the Group introducing
another large-scale precinct to the
foreshore area in the form of the
R15 billion Harbour Arch precinct,
the Group’s most ambitious Cape-
based project to date.