Year-end tenant shuffle calls for smarter rental strategies, not automatic increases

At this time of year, South Africa’s rental market traditionally enters one of its busiest periods, with many tenants on the move for practical reasons such as relocating closer to schools their children will attend in the new year, changing jobs, retiring, or moving nearer to family support networks.

"And for landlords, this seasonal churn is often seen as an opportunity to increase rentals. However, market conditions in late 2025 suggest that automatic rent hikes may not always be the most effective strategy," says Ephraim Zaslansky, a director of leading Johannesburg property group FIRZT Realty.

"The total amount of personal debt outstanding in SA is more than R2-trillion and, according to the latest figures from PayProp, tenants spend an average of almost 48% of their net income on debt repayments, despite the interest rate decreases in the past year. On average, rent costs them another 31% of their net income, so many tenants who are on the move at this time of year will be actively looking to reduce their monthly expenses.

"They know that the new year is bound to bring increases in school fees, insurance and medical aid premiums, electricity and water tariffs, taxes and other costs over which they have no control. But they can do something about their housing costs, and they are definitely prioritising affordability as well as location whenever they move now, so that they can accelerate debt repayment and improve their financial resilience.

"Many other tenants are also specifically looking to cut rental costs now so that they can save a deposit and purchase homes of their own." 

At the same time, he notes, tenants in the main economic centres currently have more rental choices than they have had in years. "In Johannesburg in particular, the past six months has seen a surge in new residential developments close to business hubs and transport corridors, and this increased supply is placing pressure on older rental stock to remain competitive.

“In this environment, landlords who rely solely on rental increases to improve returns may find themselves facing longer vacancies, and a vacant property can quickly cost more than a modest or deferred increase.

“For example, an inflation-related increase of 4% on a property currently renting for the national average of R9200 a month might only bring in about R4400 of extra income a year, but you could lose more than double that amount if the property is vacant for just one month because tenants regard it as overpriced.”

So what landlords should focus on, says Zaslansky, is trying to improve both demand and tenant retention by looking at the overall value proposition of their properties.

Practical steps include:

*Ensuring that the property is well maintained. Fresh paint, working appliances, secure doors and windows, and well-kept common areas make a strong first impression and reduce objections during viewings.

*Including or upgrading key features. High-speed fibre readiness, prepaid electricity and water meters, energy-efficient lighting and secure parking are increasingly seen as essentials rather than luxuries. “Excellent security is also non-negotiable, but landlords can increase the appeal of their properties by installing gas stoves, solar geysers or heat pumps to reduce electricity costs. First time renters also appreciate properties that come with additional appliances such as a fridge and a washing machine.”

*Offering flexibility. Varied lease options and staggered escalation clauses are attractive to tenants who are budgeting carefully.

*Keeping rentals market-related. Rentals vary greatly from province to province and even from area to area, and setting a competitive price that is in line with comparable properties in the same area is the key to quicker placement and more stable, long-term tenants.

*Getting expert help. “It is vital to work with professional letting agents who will not only provide accurate rental pricing guidance, but also screen tenants thoroughly, reduce vacancy periods through proactive marketing and ensure that all lease documentation is complete and legally compliant.”

In summary, he says, landlords who take a broader approach and acknowledge tenant needs in terms of value, convenience and affordability are much more likely to achieve long-term success, in the form of stable occupancies and reliable rental income for years to come.

Issued by FIRZT Realty

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About FIRZT Realty 

Established in 2003, FIRZT Realty initially focused on residential real estate, but has since expanded to offer a broad range of services in both the residential and commercial property sectors, including sales, rentals, auctions and property management.