“Rental Market Analysis”

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Presentation transcript:

“Rental Market Analysis” Michelle Dickens | TPN Credit Bureau June 2012

Objective – Favourable Rental Returns Realised via: Quality Tenants Well maintained property Well managed rent collection Property Management Systems Payment Collection Systems

Objective – Favourable Rental Returns Elements of a Quality Tenant: Past tenant behaviour (best prediction of future Payment) Affordability Ability to pay vs. desire to pay Tenant who has the means & wants to pay Tenant who has the means but won’t pay Tenant who does not have the means and can’t pay

Market Analysis – United Kingdom Number of UK properties by Tenure (2009) Source: Big Issue Invest – The impact of social housing rent-payment data on credit scoring

Market Analysis – United States US Households: Renters & Owners (2011) Source: NMHC tabulations of 2011 Current Population Survey, Annual Social & Economic Supplement, US Census Bureau

Market Analysis – South Africa Total number of dwellings Source: Stats SA, General Household Survey 2010

Market Analysis – South Africa SA Household Tenure Status Source: Stats SA, General Household Survey 2010

Market Analysis – South Africa Source: Stats SA, General Household Survey 2010

Market Analysis – South Africa Source: Stats SA, General Household Survey 2010

Market Analysis – SA residential tenant trends TPN Credit Bureau Statistics : National Average Q1 2012

Market Analysis – SA residential tenant trends TPN Credit Bureau Statistics : National Average Q1 2012 Cause & Effect <R3000 : Inflation (specifically electricity) >R12000 : Interest rates (9 month lag)

Market Analysis – SA Credit Bureau trends NCR Credit Bureau Monitor: Q4 2012

Market Analysis – South Africa TPN Survey Institutional landlords (City Props, POMA) Micro Investors (1-10 props): 75% < 100 investors with 100 + properties

Tenant Behaviour Risk factors Deposit used as last months rent Application to rent in spouses name / family member notably children Delinquent tenants target private landlords Negotiating hand over of keys prior to payment Fraudulent supporting documentation notably ID, proof of payment

Market Analysis – SA commercial tenant trends TPN Credit Bureau Statistics : National Average Q1 2012

Market Analysis – Good standing trends Commercial Tenant vs. Residential Tenant vs. Consumer Credit

Any Questions? Michelle Dickens Twitter @michelle_tpn Web: www.tpn.co.za