Page 24 - IFV Issue 1 January 2026

Property & Finance

WHY RENTING CAN BE A SMART

FINANCIAL MOVE

wning property is still a understanding of what you really want and rent for R10 000, you can save the
deeply held goal for many before you buy. R5 000 difference towards your deposit;
OSouth Africans. A home Renting offers far greater flexibility every year, you’d be putting away R60
represents stability, legacy and long- than ownership: if your job changes, 000 and would have your deposit in just
term financial security. But the path to your needs shift, or your circumstances over two years – not counting interest or
ownership doesn’t need to be direct, evolve, moving on from a rental is far less investment growth if your savings are in
and in some cases, it may not be the complicated than selling a property. an interest-bearing account.
destination at all. A 2025 article in Forbes outlines four
Renting is increasingly seen as a key considerations when weighing Renting can allow you to invest
strategic financial decision. Whether up whether to rent or buy. One of the instead of buy
you’re working towards a deposit or clearest advantages of renting, it says, is While many tenants intend to buy their
exploring more flexible ways to grow the ability to save aggressively or remain dream home one day, others believe that
your wealth, renting can offer the space, mobile while avoiding the commitment renting offers the opportunity to grow
stability and financial control needed to of a long-term bond. The article also wealth through diversified investments,
build your future on your own terms. highlights the value of keeping your particularly in shares, ETFs or unit trusts.
capital liquid in an unpredictable A home loan is one of the biggest
Control and predictability economy. debts most of us will ever take on.
Buying a home comes with major upfront Although it may be productive debt
expenses. Beyond the deposit, buyers Stay focused on your long-term tied to a physical asset, it still represents
must also cover legal fees, transfer duty, goal a major concentration of your wealth in
bond registration and bank charges. The 2025 Emerging Trends in Real one place. That carries risk.
Together, these can add up to hundreds Estate report from PwC notes that Some investors argue that your money
of thousands of rands. And once the sale affordability and lifestyle flexibility are key may be better put to work elsewhere. The
is final, the bills continue: rates, levies, drivers for younger households choosing long-term growth potential of equities,
insurance, maintenance and security, to rent. With interest rates still elevated, especially when held over the average
all of which must be factored into your many South Africans are waiting before term of a home loan, can be significant.
monthly budget. entering the property market. Renting Investing early, even modestly, creates
Renters, by contrast, generally pay can help make this possible by freeing the opportunity to benefit from
a single, predictable monthly amount up income to put towards a deposit and compounding returns.
(in some cases, electricity, refuse and/ other costs. But this only works if the This doesn’t mean buying property
or water and sewerage are separate, tenant avoids overcommitting. is the wrong decision, but it reinforces
for the tenant’s account). They are also A common mistake is signing a lease at the idea that renting, when combined
protected from the volatility of rising the highest rent you can afford, simply for with smart financial planning, can be a
bond repayments and are better able short-term comfort or lifestyle. Doing this strategic phase in wealth creation.
to plan ahead with fairly consistent undermines one of the key advantages Whether your goal is a home or a
monthly costs, and in most cases, of renting – the ability to save. If your stronger investment portfolio, what
major repairs and maintenance are the rental takes up your full budget, there’s matters is how intentionally you use
landlord’s responsibility. little room to set money aside for a this time. Either way, renting gives you
In South Africa, renting can also allow deposit, emergencies or other goals. options. It offers more freedom and less
people to invest in education, launch Rather approach savings with the same commitment, more liquidity and less risk,
businesses and live in areas closer to commitment you would apply to a bond. more financial control and less pressure.
work, schools or public transport, which A better strategy is to rent below Renting is not just about where you
they may not be able to afford just yet. your affordability threshold. If you aim live now – it’s about where you’re going
It also gives you time to improve your to buy a R1.5 million home, the bond next.
credit score, reduce debt, research repayment for that would be around
neighbourhoods and refine your R15 000 per month. If you are disciplined Issued by Paddington Station PR on behalf of Just Property
Group.

22 • January/February 2026 • The Villager