The profile of South Africa’s standard property investor has changed dramatically in the last decade. A few years ago, the profile was male and between the ages of 30 and 40, but the latest figures reveal a significant change. Now, it’s young women who are driving the investment market, a shift that bodes well for a housing market recovering from a pandemic during an economic downturn. “The average most active property investor is female and under the age of 30,” says Michelle Dickens, managing director of credit bureau TPN. “Whereas we used to see millennials staying in rented accommodation for as long as possible, more are starting to see the benefits of investing in property.”
Data from TPN shows the so-called “micro landlords”, who own fewer than 10 investment properties, make up 98% of the investment market. A significant 87% of investors own two to four properties, while 11% have between five and nine properties. Dickens says the lower interest rates have motivated millennials to invest in the property market. “It could also be because property prices, in nominal terms, have remained fairly flat in most areas,” she says.
Rental properties allow people to change jobs and move around, but now that millennials are moving out of this life phase, there’s a growing interest from this cohort in buying, rather than renting. And, in many cases, they’re investing not only in their primary residence, but in investment properties that will offer substantial long-term yields. BetterBond CEO Carl Coetzee says there’s substantial evidence that women are going to continue to have a significant impact on the property market and its post-Covid recovery. Forty percent of all BetterBond’s applications this year have been from women buyers, up 12% year on year. Bond approvals for women have also increased significantly in the past decade, increasing from 14% in 2010 to 41% in 2020. Of these applications, 60% were from single women.
“These numbers show unequivocally that women are asserting their financial independence and recognising the value of investing in a stable asset class such as property. The notion of a male and middle-aged investor has been turned on its head, and this broadening of the investor pool will go a long way to ensuring that property investment remains dynamic and sustainable,” says Coetzee.