#JustIn: Landlords charge high rent deposit
Deposits for rental properties have been growing at double digits since last June, registering 14.1% in the last quarter of 2023.
According to FNB Namibia, this suggests that landlords are in a better position to charge higher deposits due to increased demand.
The FNB Rent Price Index reached a 12-month average of 7.2% in the fourth quarter of last year – the highest in six years.
“We maintain our view that the dynamics in the rental market are not in line with what would be expected in a high price and elevated interest rate environment which would weigh on affordability,” FNB Namibia says.
The financial institution attributes the higher demand for rent to the fact that mortgages are unaffordable in the current high interest rate environment. Consumers are opting to rent for longer, thereby enabling landlords to pass on higher rental prices and deposits with prospective tenants.
“The arrival of expats for oil and gas activities could potentially also be impacting the rental market. Furthermore, the decision by individuals to delay the purchasing of properties and rent for longer will continue to support the rental market,” FNB Namibia says.
According to FNB Namibia, this suggests that landlords are in a better position to charge higher deposits due to increased demand.
The FNB Rent Price Index reached a 12-month average of 7.2% in the fourth quarter of last year – the highest in six years.
“We maintain our view that the dynamics in the rental market are not in line with what would be expected in a high price and elevated interest rate environment which would weigh on affordability,” FNB Namibia says.
The financial institution attributes the higher demand for rent to the fact that mortgages are unaffordable in the current high interest rate environment. Consumers are opting to rent for longer, thereby enabling landlords to pass on higher rental prices and deposits with prospective tenants.
“The arrival of expats for oil and gas activities could potentially also be impacting the rental market. Furthermore, the decision by individuals to delay the purchasing of properties and rent for longer will continue to support the rental market,” FNB Namibia says.
