Must I sign a lease with my tenant?

What information must be on a written lease?

Should I ask for a deposit?

Can I increase the rent in the middle of a lease period?

Must I sign everything or can my agent do so on my behalf?

What can I do if a tenant claims to have paid the rent, but I haven't received it?

My tenant's lease expired a few months ago. How much notice must I give, if I want my tenant to move out?

What can I do if the neighbours complain about my tenant?

What should I do if I suspect my tenant is involved in illegal activities on my property?

What can I do if the tenant has damaged the property?

What laws govern rentals in South Africa?

MUST I SIGN A LEASE WITH MY TENANT?
 
A verbal agreement is as binding as a written lease, but if your tenant insists on having something in writing, you must comply. It is, however, better for both of you to have your agreement in writing to set out the terms and conditions agreed upon. This will go a long way to preventing later disputes, when it is your word against your tenant's.


WHAT SHOULD BE CONTAINED IN THE LEASE AGREEMENT?

• Your name
• Your tenant's name
• Your postal address
• Your tenant's postal address
• The address of the property being leased
• The amount for which you will rent it out
• The amount by which the rent will increase (for example, by 10 percent when renewing the lease)
• When the rent will increase (for example, if there is a rates increase)
• How often rent is to be paid, (for example, monthly)
• The amount of the deposit, if any
• Your and your tenant's obligations (for example, who is responsible for maintenance? Who will pay the water, electricity and rates bills? Usually, the tenant pays for charges related to consumption, such as water and electricity, and the landlord pays for charges related to the property, such as rates.)
• The conditions under which either you or your tenant can give notice to cancel the contract (for example, if specific maintenance is not done, or if the tenant is in arrears with the rent)
• The House rules, signed by both parties, should be attached to the lease.
• A list of defects drawn up during a joint inspection when the tenant moves in. This should be signed by both you and your tenant and attached to the lease.

WHAT BACKGROUND CHECKS SHOULD I DO?
 
Speak to the tenant's current landlord for a reference. It's also a good idea to speak to previous landlords, as the current landlord may give a good reference as a way to get rid of an unwanted tenant, and to get a letter from your tenant's employer to verify his permanent position and income.

You can also do an ITC credit check (call TransUnion ITC on 0861 482 482 or visit www.transunionitc.co.za).

This is probably one of the core reasons for using a credible agency. We for instance, obtain TPN reports which specifically provides a report on tenancy history. In addition, we obtain full Credit Bureau checks and on top of that, Detailed Credit Information which allows us to properly analyse the clients credit worthiness.

The latter report is extremely valuable, when for instance a client has arrears but historically has always paid their rent on time. This means they are pretty good tenants who take theri rentals seriously and only default on clothing accounts etc.


WHAT DEPOSIT CAN I ASK FROM A TENANT?
 
In short, you may ask whatever deposit you see fit but keep in mind that the higher the deposit, the fewer people can afford it. Property network works on a credit asessment criteria i.e higher risk tenants are asked for higher deposits.

Remember that the deposit must be put in an interest-bearing account for the duration of the lease and given back to your tenant, plus the interest it has earned, when the tenant moves out. If rented out through an agency this will be handled by them an dthe interest does not have to be paid over to the tenant unless so specified in the lease.

If, however, your tenant still owes you money on moving out, or if the property has been damaged beyond normal wear and tear, you can use the deposit to pay for repairs or to cover the money owed to you


CAN I INCREASE THE RENT IN THE MIDDLE OF THE LEASE?
 
Not unless your lease agreement specifically says you can. If you want, you can add a clause such as those in the Property Network standard lease, listing specific reasons that would allow you to increase the rent (for example, if the rates increase).


MUST I SIGN ALL DOCUMENTS OR CAN MY AGENT DO SO?
 
Once you have mandated your agent, they can sign the lease, inspections and all other documents on your behalf. The Rental Housing Act specifically speaks of "the landlord or their appointed agent".


TENANT CLAIMS RENT HAS BEEN PAID BUT I HAVEN'T RECEIVED IT?
 
It is your tenant's responsibility to make sure that you receive the rent, so your tenant will have to show you proof of payment (for example, a bank-deposit slip). If your tenant can't do so, you can give your tenant notice in terms of your agreement and seek a court order for eviction.
 
If you are satisfied that payment has, indeed, been made, you are then obliged in terms of the Rental Housing Act (Act 50 of 1999) to provide you tenant with a receipt.
A receipt must contain the following information:

• The date of issue
• The address of the property for which the payment is made
• The reason for the payment (whether it's rental, arrears or a deposit)
• The period of the payment (for example, the month for which the rent will be paid).

LEASE EXPIRED A FEW MONTHS AGO - WHAT NOTICE DO I HAVE TO GIVE NOW?
 
Check your previous lease for a renewal clause that outlines how much notice you must give in such a situation.

If there is no such clause, then the two of you have, through your actions, effectively renewed the previous lease, on the same terms and conditions, and for the full period stated in the original agreement. This means that you will have to invoke the cancellation clause of the original lease, if there is one, in order to get out of the agreement.

Without a cancellation clause, the best way to get out of the contract would have been to give your tenant one month's notice, in writing, before the lease expired. (So if you were nearing the end of a 12-month lease, you should have let your tenant know, in writing, at the end of the eleventh month.)


WHAT CAN I DO IF MY TENANT DISTURBS THE NEIGHBOURS?
 
Check if the tenant's behaviour is in violation of the House rules. If so, you may be able to invoke your lease's cancellation clause and give your tenant notice. Keep a paper trail of complaints and your actions as proof.

If not in a complex and no house rules available, then your neighbours must lay a complaint with the local council or police depending on the problem. Make sure case numbers and other paperwork is kept to assist you in invoking your cancellation clauses.


WHAT SHOULD I DO IF I THINK THE TENANT IS INVOLVED IN ILLEGAL ACTIVITIES?
 
Report your suspicions to South African Police Services. It is also a good idea to add a clause to your lease, such as those in Property Network leases, stating that no illegal activities are to be conducted on the property, which would give you grounds to cancel the lease immediately.

Do remember that you may not cancel the lease, purely on a suspicion.


WHAT CAN I DO IF THE TENANT HAS DAMAGED THE PROPERTY?
 
If you asked for a deposit, you can use the money to repair damages attributed to the tenant beyond normal wear and tear when the tenant moves out. Be sure to follow these steps:

• When your tenant moves in, inspect the property together and list, in writing, any existing defects - both should sign this and it must be attached to the lease agreement.
• When your tenant moves out, inspect the property together again, ideally no earlier than three days before the tenant moves out. Compare the new list of defects with the list you made earlier.
• You may give the tenant a chance to do the repairs personally, or you can agree that you will do it. Hold on to receipts for repairs paid for out of the deposit. Your former tenant has a right to see them.
• If repairs cost less than the deposit plus the interest accrued, you will have to reimburse your former tenant with the difference.

Contact the Rental Housing Tribunal if you have problems.


WHAT LAWS GOVERN RENTALS IN SOUTH AFRICA?
 
The Constitution
Rental Housing Act 50 of 1999
Rental Housing Amendment Act 43 of 2007
Rental Housing Amendment Act 35 of 2014 (not yet applicable but due to come into effect 2015)
Prevention of Illegal Eviction Act of 1998
Estate Agency Affiars Act 1997 - if using an agency
Consumer Protection Act 68 of 2008
Financial Intelligence Centre Act 38 of 2001
Social Housing Act 16 of 2008 - if applicable
SARS Tax Laws as applicable


If you have any further questions, why not contact us