The Eastern Cape and certain areas in KwaZulu-Natal are experiencing notable growth in the buy-to-let investment boom says Seeff in areas such as Hillcrest, the Upper Highway region, the Midlands, and the North Coast including Ballito and Richards Bay.

KwaZulu-Natal’s rental market has become attractive for landlords by achieving inflation topping rental growth of 4.5% year-on-year – just behind Gauteng in terms of average rent. Notably, rents have risen faster compared to property prices which have lagged at just 2.2% over the last year according to Lightstone data.

Seeff Midlands, which includes Pietermaritzburg, Howick, and Hilton, says there are plenty of opportunities for investors in the area where they can capitalise on steady monthly income stream like Hilton, particularly popular for its growing local economy, good schools, and amenities.

Rentals in the Midlands area vary from around R5 500 to R8 500 per month for small apartments up to R18 000 for two-bedroomed units with properties in estates ranging up to R25 000 per month and houses reaching R48 000 per month.

There is also an interest from tenants for small cottage rentals which could render an income of around R6 500 per month for a one-bedroomed unit.

Pietermaritzburg and the Howick area are more popular for affordable rentals, as well as commercial rentals due to the business opportunities fuelled by exposure to larger publics in these areas.

The R6 500 – R10 000 per month rental range offers particularly good investment opportunities with the average rental escalation around 8% depending on location, number of rooms, whether furnished or not, as well as other stock on the market in the area.

For rental investors in Richards Bay, the sectional title market is particularly popular, especially in the R700 000 to R1.2 million price range with units selling in the upper price range achieving monthly rentals of around R6 500 to R7 000 at a yield of about 5%.

Rental rates in Richards Bay tend to average at around R5 000 to R8 000 for apartments, and R10 000 to R15 000 for townhouses with freestanding houses range between R13 000 R18,000.