These are some of the best areas for buy-to-let property investments in South Africa

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The rental market in South Africa is booming, and Seeff Property Group has named the best areas for investors looking to get a piece of the pie.

ooba Home Loans said that buy-to-let investments now make up 10% of all bond applications, which also appear to be on the up.

Although the Cape is seen as the centre of property investment in South Africa, Seeff said that there are several other urban areas where there is a growing influx of people looking for rental accommodation.

John O’Reilly, a rentals agent with Seeff Randburg, said that the Johannesburg area is proving to be incredibly popular, with multiple opportunities for buy-to-let investors with apartments, townhouses and free-standing homes highly desired by renters.

With one and two-bedroom apartments in the R 800,000 to R1.5 million bracket and freestanding properties between the R1.2 million to R2.5 million range, the gross rental yield in the Randburg area is between 8% and 12%.

Investors must, however, do their homework and factor in costs, including levies, rates, taxes and possible maintenance costs. Location is also a crucial factor, O’Reilly said.

Centurion is also proving to be a good rental market, with Tiaan Pretorius from Seeff Centurion saying that two and three-bedroomed units in sectional title complexes are in huge demand due to their low price offering of R750,000.

Net yields in Centurion also range from 6% to 7% per annum for newly purchased properties, with some areas even breaking the 10% range.

Net yields range from 6% to 7% per annum for newly purchased properties, with a few areas breaking the 10% range over a few years.

Cape Town’s Century City is also seeing huge demand in its rental market, with there being a large percentage of apartments owned by rental investors.

To maximize your rental return, it is important to explore properties within the price range of R1.85 million in Century City, where one can anticipate a monthly rental income of approximately R13,500.

In terms of yield, investors can expect an average of around 5%, depending on the budget and if they are keen to keep expenses down.

In KwaZulu-Natal, Richards Bay has also been noted as popular for buy-to-let investors, with sectional titles in the R700,000 to R1.2 million offering the best return.

Catherine Chetty, rentals administrator for Seeff Richards Bay, said that customers who ensure that a rental covers more than 75% of their bond are getting a good return.

According to Ms Chetty, investing in buy-to-let real estate allows you to generate monthly cash flow through rental payments made by tenants, and as real estate is a tangible asset, its value continues to increase.

Thus, the longer you keep a property, the higher your return is likely to be.

Below are some properties on the market in these hotspots: