Returning expats are not only fuelling rentals across Cape Town, but also sales.

According to Lanice Steward, MD of Anne Porter Knight Frank, the much-discussed return of South African expatriates from overseas countries hit by the world?s economic woes is having a beneficial effect on the Cape property market as a high proportion of these people are heading for Cape Town.

"I am told that 200 000 bankers and financial sector staff have lost, or will lose, their jobs worldwide," said Steward. "The good news is that those returning to SA now comprise nearly three percent of our buyers and, in our experience, are finding jobs here often by setting up in a new business, which is good for the economy.

"Most, too, are capable of paying large deposits or of buying the property with one cheque. This means that they are not held back by the National Credit Act rulings."

UK and EU retirees coming to SA

A steady, though small, stream of retired persons, said Steward, is also still coming to South Africa from the UK and Europe ? and she predicts this will increase.

"On the current exchange rate they still get far more for their money and enjoy a far better lifestyle than is possible in their home countries. I am quite certain that if SA published the figures of our houses more widely overseas we could attract far more foreign retirees ? particularly with the publicity that the World Cup and the election brings.

"If this election is carried through peacefully the message that we are a reasonably secure society will go out to the world. I, for one, am confident that there will be only minor disturbances and that 2010 will so raise our profile internationally that we will attract more home buyers."

Returning expats fuel rentals across CT

In the face of high interest rates and stricter than ever lending conditions at the country?s banks, many would-be first-time homeowners are finding it difficult to enter the market at present. The result is an upswing in rental activity across Cape Town, says Pam Golding Properties? Western Cape Rentals Director Dexter Leite. He says there has been a surge in activity across all areas and price ranges ? fuelled not only by those who can?t afford to buy, but also by the number of expatriates returning home to South Africa.

"Right now we are seeing high demand in all of the traditionally popular areas such as the Southern Suburbs and Atlantic Seaboard," says Leite, "as well as in the Northern Suburbs and the Blouberg region. The City Bowl has also seen high levels of rental activity as more and more people seek to avoid the cost and frustration of commuting and traffic congestion by living close to their places of work. Historically, these popular areas have always been short of rental properties and this has not changed for those properties which fall within the sought-after parameters such as modern two-bedroom apartments or three-bedroom homes which are appropriately priced. Our Western Cape rentals branches concluded more than 150 lets in December 2008 and in excess of 100 in January 2009 and we have continued to experience very high levels of activity into February."

Among those fuelling the demand for rentals are the returning expatriates who are coming home after spending a few years overseas. For them, says Leite, letting can be a very sensible option, especially upon their immediate return. "Many of these people have been out of the country for an extended period," he says, "and during their time away their specific needs may have changed quite substantially ? for example, their financial status, their marital status and their employer. They may also find that the cities they lived in before have changed substantially with new infrastructure affecting commuting options or new business hubs having developed where they might want to work. For these returning expatriates it can be most beneficial to first rent for a short term while they assess what their new needs are, consider different suburbs where they might wish to settle and get a feel for commuting times. Renting provides them with the flexibility to make these decisions without pressure. It also allows them to focus on finding their feet and re-establishing themselves in South Africa without having to worry about homeowners? responsibilities such as maintenance, a mortgage, insurance, rates and taxes."

Retired visitors from the EU and UK renting whilst considering settling here permanently

A further emerging trend is for retired visitors from Europe and the UK to come and spend an extended period in South Africa ? a year or sometimes more. Some of them are renting whilst considering the possibility of settling here permanently, says Leite, while others are simply here for an extended holiday. With exchange rates working in favour of those with foreign currency, there are many opportunities for them to rent high-end properties in prime locations such as on the Atlantic Seaboard.

Leite adds that PGP continues to see particularly high levels of activity at the top end of the rental market, mainly in the more exclusive areas of the Southern Suburbs and Atlantic Seaboard where clients are seeking properties that support and epitomise a secure lifestyle with all the benefits that an up-market property in an exclusive suburb can offer.

Rentals here can range from R30 000 per month to R80 000 per month ? or even more in isolated cases. In the period from November 2008 to February 2009, PGP agents have concluded lease agreements of R65 000 and R120 000 per month for houses in Bantry Bay, R25 000 per day for a house in Bishopscourt (on a holiday/short-term let basis) and R70 000 per month for another house in the same suburb. PGP has also recently concluded a R115 000 per month lease in Bishopscourt on a short let basis. The company has further let homes in Camps Bay for R36 000 and R28 000 per month and a Constantia property for R50 000 per month. Also notable were leases in the City Bowl for R35 000 and R32 000 per month and R15 000 and R16 000 in the Northern Suburbs ? particularly high for this area. The market for apartments is also strong with PGP agents achieving rentals of R75 000 and R23 000 per month for units in the Waterfront and R20 000 per month for an apartment in Mandela Rhodes Place in the central city.

The CEO of ERA South Africa property group agrees

The global credit crunch may have at least one positive aspect to it, namely encouraging South Africans who have been living abroad to return to the country and in the process provide a degree of stimulus for the property market.

Gerhard Kotze, CEO of the ERA South Africa property group, says anecdotal evidence suggests this is already beginning to happen ? and that many South Africans have postponed their emigration plans.

"There is a new wave of joblessness in the UK, Australia and the US; traditionally regions that have attracted skilled South African emigrants. Even Dubai, where there are an estimated 50 000 South Africans, has felt the waves of the global recession. Worldwide jobs are scarce and retrenchments are the order of the day, most notably in the UK financial sector, retailing and tourism.

"By contrast South Africa, while by no means having escaped the impact of the global economic problems, is comparatively better off in terms of employment opportunities, a situation created paradoxically by the emigration of the last few years, but also by the fact that the country has a relatively sound business and banking sector."

Nobody is suggesting that we?re about to see a flood of South Africans returning to the country, he says. "Nonetheless there are indications of something of a reversal of the outflow of recent years. Guy Lundie, co-author of 'South Africa, Reasons to Believe' has been quoted as saying the grass on the other side is looking a little less green.

"Also the Homecoming Revolution, a group which tries to persuade South Africans living abroad to return home, was recently quoted as saying that four out of five South Africans who attended a group exhibition in London last year were planning to return to South Africa."

Kotze says that in addition, personnel agencies are reporting a 'dramatic' increase in the numbers of international professionals and South African expats seeking employment in South Africa.

"And realistically, prodigal South Africans equipped with sterling, euros or dollars could provide something of a fillip for the property market."