RoomKing
Pioneering a new era in backyard rental accommodation
“The backroom rental market has an estimated value in the tens of billions of rands, and yet it’s unserviced and uncared for.”
For far too long, South African townships were economically disadvantaged due to their geographic position away from greater metropolitan areas. However, over the past 30 years, townships have transformed into thriving communities that continue to realise their immense economic potential through entrepreneurial activity.
According to recent estimates, South Africa’s (SA’s) township economy is valued around R100 billion per year, indicating a considerable contribution to the country’s national GDP. One such area of significant economic potential is the backyard rental accommodation market.
Fast facts
10 million: Number of people believed to rent backyard rooms in townships or informal settlements in SA
500 townships: Number of townships in SA
11.6million
Combined population of SA townships
Average monthly backroom rental cost
R12 billion:
Estimated annual revenue generated by the backyard rental sector
Yet, the township market is informal and unregulated. To help improve this value chain, Modicai Mnculwane, an ambitious property practitioner, founded RoomKing, a unique online platform that connects landlords and tenants in townships via a secure, safe and centralised online platform. The platform streamlines what had previously been an onerous process and interaction.
Modicai, who gained his deep experience of the industry while working at Mafadi Property Management in Johannesburg, feels that backyard rentals in South African townships have the potential to strengthen the country’s economy and restore dignity to tenants.
The drive to make a difference
Modicai’s quest to provide dignified shelter to low-income clients is rather personal. “From a young age, I always believed in making a difference,” he says. “I’ve seen first-hand the challenges that come with informal backroom accommodation through the experiences of my own family and friends. These challenges have shaped my commitment to creating a solution that not only addresses these issues but also empowers those involved in this sector.”
Hailing from Estcourt (eMtshezi), KwaZulu-Natal, Modicai moved to Johannesburg in early 2006 in search of opportunity. For a time, he lived at Jeppe Flats in downtown Joburg and, later, he landed a job as a rent collector in Hillbrow – two experiences that greatly shaped his thinking about low-cost shelter. “Day in and day out, I knocked on doors collecting rent money, and that’s how my passion for property was born. I later moved to Alexandra township where my backroom rental passion was fuelled.
“The backroom rental market has an estimated value in the tens of billions of rands, and yet it’s unserviced and uncared for. Roughly 10 million backrooms are being rented out in an unserviced environment, operating totally informally. Furthermore, there are major disconnects between landlords and tenants. There are no agreements, no transaction records, no proof of addresses. Most importantly, even if you desperately want accommodation, there’s no real place to list and find these backrooms.”
A backyard rental revolution is born
So, in May last year, Modicai used his own money and seed funding from Buffet Investments to launch RoomKing, a centralised marketplace for backroom rentals in SA’s townships. The platform has listings from landlords in all local townships. The plan is to be the go-to platform for finding quality, backyard rooms – whether it’s renting out a whole structure at the back of a main house or a room inside. “We give landlords maximum exposure for their listings and, ultimately, help them to find tenants as quickly as possible,” he says. “Listing backrooms on the platform is free of charge.”
Convenience and transparency are at the heart of RoomKing, as the platform allows landlords to screen prospective tenants. Tenants, in turn, can find out about the condition of the places they seek to rent out before they commit to a lease. Furthermore, RoomKing advises on rental agreements to ensure all parties know their responsibilities and rights.
“So far, RoomKing has listed more than 85 000 rooms,” adds Modicai. “Remember, township landlords and agencies have multiple properties – the average is five or more, and this can equate to more than 215 000 single rooms on our app. This is the most centralised place to list and find a room in the country.”
RoomKing is yet to turn a profit and makes money from online advertising on its social media platforms.
If there’s one major lesson he has learned since launching RoomKing, it’s this: “A landlord wants to rent their properties and a tenant needs a decent home to stay. Balancing these two needs is key.”
RoomKing harnesses technology in its operations. In addition to the company’s app, prospective tenants can browse RoomKing’s website – www.Roomking.com – for quality accommodation. “Our digital platforms are easily accessible to everyone, everywhere,” says Modicai. “Currently, people in ikasi rely on word of mouth, notice boards in shopping centres and generalised sites such as Facebook Marketplace.”
But Modicai is the first to admit that doing business in the township is not easy. “While I believe in townships, there are numerous practical challenges, such as power cuts, insufficient infrastructure and extortion practices,” he says. “However, if you can overcome these obstacles, you will quickly realise that there’s a lot of potential for growth. I encourage more entrepreneurs to invest in townships.”
In the future, RoomKing hopes to expand into township retail, such as spaza stores and salons. For the time being, Modicai is focused on expanding his business and, ideally, turning a profit. “We expect to have 100 000 listings by the end of this year,” he adds. “We’d want to see more landlords negotiate deals through RoomKing, ranging from 30% to 60%. We also want to be in more townships.”
RoomKing is a story steeped on a young man’s personal goal of addressing a major challenge: sheltering the marginalised. “By addressing the personal issues I’ve faced, I hope to make a difference in the lives of others,” says Modicai. “This journey has taught me the value of personal connection and dedication in driving meaningful change.”
For more information on RoomKing
