Of course this isn’t surprising when viewed against the stability of interest rates and improvement in the household debt to income ratio. The National Credit Regulator’s Credit Bureau Monitor remained unchanged overall for the Q4 2011 period, with 53.8% of 19.34 consumers considered to be in good standing.

Nonetheless there is still grave cause for concern evidenced by the fact that 46.2% of consumers are considered to have
impaired credit records.

On the positive side there is another influential factor which is seldom noticed – let alone appreciated on the South African property landscape:

The overall number of well-managed, well-maintained and well-tenanted properties. The size of our residential rental market includes 2,261 million households (20,58% of the formal housing population: source Stats SA, General Household Survey 2010) where 75% of landlords are microlandlords (owning 1-10 properties). Although it is commonly accepted that there are pockets of excellence and pockets of ill-qualified or illadvised performance in any industry, a market of this size, serviced by 9829 registered estate agencies, has demonstrated surprisingly few extreme cases of tenant/landlord/agent disputes.

National payment profile virtually unchanged:

Tenants in good standing remained unchanged at 81%; comprising 68% in the Paid on Time category and 13% in the Paid Late category.

Effectively these tenants are fully paid up each month; leaving 8% of tenants making a Partial Payment and 11% in the Did Not Pay category.

The Did Not Pay category can be further categorised between those tenants whose circumstances have changed and are unable to meet their rental payments but willingly vacate the property, VS. those who TPN has had to classify as “squatters”. I.e. Tenants who have a minimum of 4 months rent in arrears, whilst continuing to reside on the property. These “squatters” make up 1.67% of South African tenants.

While the property business in South Africa isn’t getting easier, and no significant changes appear to be illuminating the global horizon, this is still a time when the majority of landlords and property investors in the residential market can count their blessings.