It is now almost eight years since Taryn Steven established a Rawson franchise at North Riding, the Johannesburg suburb that lies north of the CBD and has some 6,870 homes. At no stage ever in its history, says Steven, have sales and rentals been anywhere near as high as they have been here in the first half of this year, nor has demand for property ever been as strong.
“To talk about boom conditions would be an understatement,” said Steven. “What we are experiencing here is a sales and rentals runaway that at times seems almost unbelievable.”
In recent months, said Steven, her 15 person team has been renting 20 homes and selling a further 20 each month – and if there was more stock available these figures could easily be 50% higher.
Situations of this kind inevitably lead to higher prices all round and this franchise has definitely seen these recently.
“A two bedroom, two bathroom sectional title unit at the end of 2013 which rented at R5,500 per month is now renting at R7,500. A two bedroom, two bathroom cluster townhouse with a pool that rented at R8,500 per month is now renting at R12,000 per month.”
In such high demand rent scenarios, there is always the likelihood of unpredictable, non-paying tenants cropping up. However here too, said Steven, her team has become extremely proficient and has learnt to operate effectively in screening applicants in the very strictest way – at least 50% in most cases are rejected at the outset and in cases where an immediate rental is wanted the rejection rate can be as high as 90%.
On the sales side the story at North Riding is much the same. This, said Steven, is an area in which sectional title apartments and townhouses, especially those in gated cluster estates, comprise nearly 90% of all the homes and prices can be anything from R650,000 to R2,5 million. A three bedroom home that sold in 2010 for R1,555,000 was recently was resold at a price of R1,850,000 and other more spectacular price rises are occurring regularly.
What is it about North Riding that makes it so much in demand? The answer, said Steven, is that despite highly satisfactory price rises, the average level of prices here remains very ‘affordable’ in comparison to such other Johannesburg Northern Suburbs such as Rivonia, Fourways, Douglasdale and Bryanston.
Another advantage of North Riding, added Steven, is its position: it is only 20 km from Sandton and Randburg and 16 km from the centre of Johannesburg.
Can the boom continue? At this stage, said Steven, she cannot see any signs of it tapering off, but at the same time she does not believe that such high pressure conditions will last in perpetuity. The boom could, she said, continue for another 18 to 24 months, during which time further significant price rises will be experienced all round.