Real Estate Investor Magazine South Africa April 2014 | Page 33

RESIDENTIAL
RUN THE NUMBERS

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It is important to remember that the
bond repayment is not the only expense
when it comes to rental property.
Landlords will need to factor in
expenses such as general maintenance,
insurance, rates and taxes and possibly
the services of an attorney or a professional rental
agent. The services of an attorney will be
very useful when it comes to lease agreements,
defaulting tenants and advice of the landlord’s legal
rights and responsibilities. A rental agent will also
be useful for screening possible tenants, collecting
rent and managing the property.

3

Ideally, a landlord should be setting money aside
in a contingency account for the general upkeep of
the rental property or if anything requires fixing.
By doing the math and budgeting for expenditure,
the landlord will be able to allocate money in the
correct manner.

4

HAVE A CHECKLIST

The checklist needs to include all
the items that should be checked
before a new tenant moves into the
property. Having a list will save time

and ensure that everything that needs
to be checked is gone over carefully
with the tenant. It is also far easier to check the
property for any potential hazards or things that
need to be fixed before the tenant moves in, rather
than when they are already there.
• Check the stove is in order
• Check all lights and electrical points
• Ensure geyser is working properly
• Check for any leaks or damp that needs
waterproofing
• Check that the gutters are unclogged and clear of
debris

UTILISE AND HAVE DETAILED CONTRACTS
Having all stipulations clearly stated upfront in a detailed contract will help to avoid any
misunderstandings or complications with tenants in the future. The more detail and issues that are
covered in the contract, the smoother the rental will run. It is more important that all elements
are included in the document so that there are no areas left open for interpretation. Aspects such as
acceptable tenant behaviour, breakage costs, preferred method of payment and date that the rental is
payable should be included.

5

CHOOSE THE RIGHT TENANTS

While it may be tempting to rent to a friend or family member, if anything goes wrong it could have
a huge negative impact on the relationship. An acquaintance or work colleague could be the perfect
tenant, as the landlord will have some background information and an idea of what they are like.
It is essential that landlords contact the references given and try to verify as much information as
possible. While it is not legal to discriminate against any tenant, it is also not wise to
simply accept tenants on a first-come-first-serve basis. A rental agent will be a valuable
asset when selecting the right tenant.

While not always an easy endeavour, owning a rental property and becoming a landlord can be a financially
rewarding venture. The golden rule however is that the principles of property are adhered to and that

property is viewed as a long-term investment.

RESOURCES
RE/MAX
www.reimag.co.za

REALE ESTATE BUSINESS DIRECTORY

April 2014 SA Real Estate Investor

31