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Tenant-landlord relationship - unravelling the fine print
Category Property News
While a few years ago, a very basic lease agreement was the definitive last word in the tenant-landlord relationship and common clauses included standard annual increases and simple eviction procedures requiring only a month's notice, this is no longer the case, says Lorraine-Marie Dellbridge, rentals manager in the Southern Suburbs for Lew Geffen, Sotheby's International Realty. And tenants are often unaware of the finer details of the acts which govern the rental market she adds.
"The once-straightforward contract has become more complex with a raft of legislative amendments to the Rental Housing, Consumer Protection and National Credit Acts that now impact almost every aspect of the rental arena, and ignorance could prove costly or at the very least cause unnecessary stress."
Know the law
She advises: "First and foremost, know the law. Know your rights as well your responsibilities. With that understand those of the landlord's as well. It then follows that you will know what to expect from a lease and what should be in the document in terms of the current laws.
"Ensure everything important is contained in the written lease from the get-go. If, when applying for a property, anything is promised and agreed upon, it must be noted in the lease or added as an addendum.
"And, if applicable, ensure a time limit is applied or you could end up waiting a long time for the landlord to get around to fixing that broken step or installing the agreed-upon burglar bars."
Maintenance
Maintenance is one of the most common sources of dissent between tenants and landlords. Dellbridge says that tenants have varying perceptions of their maintenance obligations and which repairs are for the landlord's account.
"The rule of thumb is that while landlords are responsible for the main structure of the home that includes the plumbing and electrical systems. They are not responsible for damage caused by wear and cannot be expected to send out a handyman to replace worn tap washers and light bulbs or to repaint a wall where tenants have knocked in nails."
Many landlords and agents send out their own invoices for utilities, usually as part of the monthly rental invoice and tenants pay on good faith, however, Dellbridge states that the law states that the landlord can only charge for provable expenses and must provide invoices if requested to by the tenant.
"And, yes, tenants are expected to pay the service costs as well as the usage for electricity and water as they are the one's making use of the services."
Rental increases
Another issue that often arises is that of annual rental increases, but the days of standard 10% year-on-year increases are long gone and, according to Dellbridge, the CPA (Consumer Protection Act) effectively prohibits one from "contracting out of law".
"The implication is that when the original lease is drawn up, it can't contain a set percentage escalation clause for year two. This means rent hikes must be negotiated and agreed to at the time of the renewal.
"However, tenants must remember that their negotiation leverage depends largely on what kind of tenant they have been and those with a strong history of regular rental payment and diligent upkeep of the property have the advantage."
Deposits and the return thereof are also often a bone of contention, but Dellbridge says that the law is very clear.
"For the duration of the tenancy the landlord is legally required to keep your deposit in an interest-bearing bank account and rental agents must place your deposit in a trust account and the interest accrued must be included in the deposit refund."
Inspection of the premises
"Furthermore, the deposit should never be refunded before the end of the lease period, and even then only once a joint inspection of the premises has taken place with both parties in attendance.
"If the landlord or the appointed agent fails to carry out both these inspections with the tenant, then it's assumed the property is handed over in an acceptable condition and the landlord is not permitted to deduct any money for repairs from the tenant's deposit at the end of the lease term.
"If there are no deductions from a deposit, your landlord must issue a refund within seven days of the inspection and if repairs are necessary, the deposit minus deductions must be refunded within 14 days of 'restoration of the dwelling' as per the relevant Acts."
Another cause of much confusion is the tenant's rights when the landlord wants to sell the property.
Dellbridge clarifies: "While the owner has every right to sell his property, the lease takes precedence and the buyer is bound to all the material terms of the lease agreement.
"This protects the tenant's rights while the lease is in place and it's very important that a buyer is aware of these terms when purchasing a property that is occupied by a tenant."
Be prepared to bare all
Her final word of caution is to be prepared to bare all when you rent a home - in terms of your finances that is.
"If you are going through an agency, they will want to vet you as a suitable candidate to present to their client, the landlord.
"Most reputable agencies use a system like TPN for credit checking which not only provides information from two top credit bureaus in South Africa, but also integrates information from another widely-used system, Payprop.
"And between the two, a tenants' rental behavior history is captured and reported. You want to score an 'A'."
Author: Lew Geffen Sotheby's International Realty