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Leases and Rental Agreements

Understand the different elements of the tenancy agreement when renting property in South Africa…

It is normal, having decided on a property to rent, to make an offer in writing. It is advisable to have a lease drawn up which stipulates the rental terms and conditions. A lease is normally used by estate agents and other companies specialising in letting properties. It is also possible to get a lease drawn up by a lawyer.

According to the Rental Housing Act, a lease must contain the following minimum information:

  • the landlord's name and address
  • the tenant's name and address
  • a description of the property, e.g. its address
  • how much rent the tenant must pay and details of any escalation (increases in rent)
  • any other moneys which the tenant must pay, such as water and lights
  • when the rent must be paid - it is usually at the beginning of each calendar month
  • how much deposit the tenant must pay as security for any damage he or she might  cause
  • the period of the lease - if there is no specific period, the lease must state how much notice must be given to end it
  • the landlord's and tenant's obligations towards each other
  • a list of existing defects to the property
  • any house rules that the tenant will have to obey
  • a list of furniture and fittings (if the property is being let as a furnished unit)

The law also states that landlords must:

  • issue a detailed receipt for every payment received from the tenant
  • if a deposit is paid, invest that money in an interest-bearing bank account and must give the tenant a written statement of the interest earned whenever the tenant asks for one

Types of lease

Property rental leases are usually 1 year, with an option to extend for another year. However, in some cases it is possible to negotiate a 6 month lease or a longer lease if required. A lease is a legally binding contract so it is often difficult to get out of rental agreements unless there is a breach in contract by either party. However, in most cases if someone else is found to take over the rent for the time remaining on the lease, it may be possible to get out of the rental agreement.

If the tenant remains in the unit after the end of the fixed term with the consent of the landlord, the lease is then deemed to be a periodic lease. Periodic leases can be terminated by giving a month’s written notice.

Rent increases

The amount of rent can be freely negotiated by tenants and landlords. The lease or rental agreement should state by how much and when the rent can be increased. If the agreement does not specify an amount or date for increase, this must be negotiated with the tenant.

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