Real Estate Investor Magazine July/ Aug 2020 July 2020 | Page 27

Your lease document should at the very
least contain the following information:
• The contact details of both landlord and tenant, including
their phone numbers and emergency numbers;
• The address and description of the rental property;
• Details of any deposit paid, the monthly rental amount
and the proposed duration of the tenancy;
• Landlord and tenant responsibilities and requirements
with regard to maintenance and security, for example;
• The procedures and notice required to cancel the lease
or renew it; and
• A list of existing property defects, compiled at a joint
ingoing inspection of the rental property, and signed by
both parties before the tenant takes occupation.
“For the sake of clarity, the lease should also detail what is
to be done with the deposit a tenant pays. It should be kept
in an interest-bearing bank account, for the benefit of the
tenant, for the full duration of the tenancy.
“At the end of this period, the tenant will be owed the
full deposit, as well as any interest earned. The cost of
repairing any damage the tenant might have caused to the
property can, however, be deducted, following an outgoing
inspection attended by both the tenant and the landlord (or
agent) within seven days of the end of the lease.”
Does your lease agreement protect
you?
One of the upsides of the Covid-19 pandemic is that it
has highlighted shortcomings in many business-as-usual
scenarios that we took for granted. The uncertainty has left
many in situations they would never have anticipated – not
least of all in the rental property sector. Ben Shaw, CEO of
digital rental platform HouseME, shares advice for tenants
to avoid unpleasant legal surprises when signing the lease
on a new rental property.
1 Utilities
Your lease agreement must specify what is included in
your lease price. Water, electricity, sewage, and refuse
removal may or may not be included in the rental (but
rates, levies and taxes generally shouldn’t be), so be sure to
check before signing the lease. Some landlords may invoice
for utilities, or certain consumables may be included or
excluded and this must be stipulated in the lease to avoid
any misunderstandings later.
2
What
about my deposit?
The Rental Housing Act specifies that a rental deposit
must be kept in an interest-bearing account and
your lease should confirm this in writing. At the end of the
lease, you are entitled to the interest that has accumulated
on that deposit, minus any evidenced administration fees.
Although the industry standard is for a security deposit of
more than one month, a number of private landlords – and
some forward-thinking rental agencies – are offering a onemonth
security deposit to attract great tenants during this
economic squeeze.
3Maintenance and repairs
Both the landlord and the tenant are responsible for
looking after the property during the lease period.
Typically, you are contractually responsible for keeping
the property neat, clean and free of unnecessary damage,
and are responsible for repairing intentional damage and
damage caused by negligence. Look at your lease in detail
to make sure the responsibilities for general maintenance
are clearly defined. It is also vital to note any flaws you find
in your ingoing inspection to avoid any disputes later on
in the lease. Most issues tend to arise a few months after
occupancy, so ensure the lease clearly states who to contact
in the event of an emergency. For example, if the landlord
lives out of town, do they have a maintenance partner who
can act quickly on behalf of the landlord?
4 Occupancy
Your lease agreement must specify who is legally
entitled to live on the property. It is usually limited to
you, your spouse or partner and any children who are still
minors. If other people who are not specified on the lease
stay for extended periods without express permission, the
landlord has the legal right to terminate the lease.
5Right of entry
All lease agreements should clearly indicate in which
circumstances the landlord/owner can enter the unit.
Some owners prefer monthly checks to inspect that no
maintenance is needed, while others are comfortable to
leave that to the outgoing inspection at the end of the lease.
Make sure that your landlord gives you reasonable notice
before an inspection.
6
Early
cancellation
Relocation and unexpected life changes happen, so
it’s wise to make sure that the early cancellation clause
in your lease is clear and defined.
7
Pet
policy
Most residential complexes in South Africa do not
allow pets, which can narrow down your options if you
want your pet to move in with you. Be sure to check that the
lease agreement specifies whether or not pets are allowed
and if so, the lease needs to specify what size and breed pet
would be permitted.
8
Read
the lease at your leisure and save
a copy
Request a copy of the lease beforehand so that you
can read it at your leisure, rather than when you’re under
pressure to sign. HouseME has a free lease agreement
available for download on their platform. Drafted by the
company’s expert lawyers, it is fully compliant with rental
law and is designed to protect you and your landlord from
nasty legal surprises later on. Once you have finalised and
signed your lease, keep a copy saved so that you can access
it for easy reference at a later stage.
SOURCES Real Net Estate Agency
Group & HouseME
SA Real Estate Investor Magazine JULY/AUGUST 2020 23