Essential clauses in lease agreements
Category Rentals
A property rental agreement is a legally binding contract between a landlord/property owner and a tenant which outlines the terms and conditions of the rental arrangement, protecting the rights and responsibilities of both parties.
According to STBB Attorneys, there are twelve essential clauses which should be included to protect the rights and responsibilities of both parties. These are:
No. 1 - The identities and information about the parties to the lease, being the landlord and tenant, including their contact details.
No. 2 - Description of the property including the address and what forms part of the property such as parking bays, access to facilities and amenities and so on.
No. 3 - Period of the lease with the start and termination date. It is also recommended to add provision for renewal and early termination with reasonable notice and conditions.
No. 4 - Rent amount, acceptable payment methods, and when and to whom it must be paid to. Also include escalation percentage on renewal, and penalties for late payment.
No. 5 - Security deposit, usually up to two months rental. Include conditions attached to reimbursement and permissible deductions for damages beyond "fair wear and tear".
No. 6 - Utilities and extra payments due by the tenant for usage including extras such as garden and other services, the due date and payment methods.
No. 7 - Maintenance and repairs. The landlord is responsible for maintaining the exterior and installations, and the tenant for the interior and repairs for any damage caused.
No. 8 - Maximum occupancy. It is vital that the agreement also provides for clear guidelines as to the maximum number of tenants who may occupy the property.
No. 9 - Sub-letting. This lease should deal with aspects around anyone who may "share" the space or lease, whether it is permitted, and if so, on what basis.
No. 10 - Pets. Stipulate if pets are permitted, and the types of pets in terms of size, and any other conditions. It should also align with HOA or Body Corporate rules.
No. 11 - Landlord's right to access. Considering tenant's rights, the lease should provide reasonable access for inspections or repairs on agreement, and with reasonable notice.
No. 12 - Breach of contract. Set out that a material violation will entitle the aggrieved party to cancel the agreement if not remedied within an agreed period advised in writing.
A strong lease agreement is vital to protect the landlord's interests and to minimise risks. As a market leading rental agency, Seeff Southern Suburbs/Constantiaberg focuses strongly on ensuring our lease agreement and services are fully legally compliant and protect the interest of our clients. Our property management services goes further by managing the tenant, rent payments, maintenance, and legal compliance, thus saving landlords time and effort, while providing tenants with professional support.
If you would like to know more about how Seeff's rental agents can help you maximise the returns on your rental property investment, contact us today!
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Author: Gina Meintjes
