Protect your rental investment with a watertight lease
Category Rentals
As a landlord or property owner you are no doubt aware of how highly regulated the rental environment has become with a number of laws which govern various aspects relating to property rentals, and with various compliance requirements.
Important laws include the Rental Housing, Consumer Protection Act, and PIE (Prevention of Illegal Eviction from and Unlawful Occupation of Land Act) Acts. These govern aspects such as tenant rights to fair practice, privacy, non-discrimination, notice periods for termination, and lawful eviction procedures.
The rental lease agreement is therefore vital. It is a foundational contract which clearly sets out responsibilities, safeguards your financial interests and the property, and ensures you operate within the bounds of the law, ultimately fostering a transparent and manageable landlord-tenant relationship from the outset.
An outdated or non-compliant lease can render certain clauses unenforceable and expose you to legal challenges and penalties. It is therefore vital that rental property investors and landlords work with an experienced rental agent or manager to ensure a lease agreement which is up to date on legal compliance issues. It should be in place before the tenant takes occupation.
Protecting the Integrity of Your Property
A watertight lease should protect the physical integrity of the property by stipulating the tenant's obligations regarding maintenance, cleanliness, and permissible use, clearly distinguishing between fair wear and tear and actionable damages. By including clauses on regular inspections (with appropriate notice), rules regarding alterations or pets, and the condition in which the property must be returned, you create an enforceable framework that minimises disputes and ensures your asset is respected and preserved throughout the tenancy.
Hedging Against Potential Financial Losses
A comprehensive lease agreement mitigates the risk of potential losses by setting out the rent and payment stipulations, and what happens in the case of late or non-payment including penalties. It should also detail the handling of the security deposit, how it will be held (in an interest-bearing account as per legal requirements), under what conditions deductions can be made, and the process for its return. Additionally, it should stipulate the penalties applicable in the event of the tenant cancelling the lease before its termination. This clarity protects your income stream and provides a clear recourse for financial recovery if obligations are not met.
Benefit of Working with an Experienced Rental Agent
An experienced rental agent can further mitigate any potential risks as they are skilled sourcing and placing tenants, and managing the tenancy. Rental agents must be registered with the PPRA (Property Practitioners Regulatory Authority), and hold a Fidelity Fund Certificate which means they will possess the relevant skills as they must operate within the framework of the Code of Conduct for Property Practitioners. Part of this training includes being able to provide accurate guidance in terms of rents and expert advice and assistance in the event of issues with the tenant.
Seeff for example offers comprehensive choice rental solutions which include tenant sourcing and vetting, rent collection management, property and maintenance management, inspections and more.
Seeff has been a market leader in residential rentals for over six decades. We have the expertise and experience backed by specialist legal support and state of the art rental management systems. For more about our rental services, please feel free to contact us at any time.
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Author: Gina Meintjes
