3 out of 4 tenants weathered the storm - don't let a good tenant drift away!

Click here to watch the video

The percentage of total tenants that were recorded as being in good standing with their landlords dropped sharply in the 2nd quarter of 2020. From 81.52% of tenants being in good standing in the 1st quarter, the percentage declined to 73.5% in the 2nd quarter, a decline of 8 percentage points. 

The weakening tenant performance since 2014/15 has seen the lowest rental value band segment leading the way. This is not surprising, given that the “Less than R3,000/month” segment is populated by the most financially fragile tenant population, with significantly fewer financial “buffers” with which to weather any storms that translate into income loss, or those unexpected household expenses that arise periodically. However, the highest R25,000+/month segment has suddenly caught up to the lowest segment’s weakness. 

The Western Cape tenant data continues to outperform the other 2 major provinces, namely Gauteng and KZN, despite also seeing a considerable 2nd quarter drop in the percentage of tenants in good standing. From 86.88% in the 1st quarter of 2020, the Western Cape’s percentage of tenants in good standing dropped to 80.86% in the 2nd quarter. By comparison, Gauteng dropped from 79.81% to 71.1%, while KZN fell from 79.15% to 70.83%. Therefore, while the Western Cape cannot avoid the severe impact of lockdown entirely, it continues to show a resilient tenant population relative to the other major 2 provinces.

Please click here to read the full Residential Rental Monitor for Q2 2020

Post a Comment