With many property buying decisions having been delayed by rising interest rates over the past two years, the number of prospective tenants has of course increased, and thus also the competition for rental homes, but this does not mean that tenants should be any less thorough when checking out a property or the terms of a lease.
So says Andrew Schaefer, MD of leading property management company Trafalgar, who notes that while official figures from StatsSA show that about one in five South African households lives in a rented home, this percentage has been growing since the start of 2022, and is expected to keep growing until inflation and interest rates moderate, because higher rates make it more difficult for would-be buyers to qualify for home loans.
“In addition, many existing homeowners who have had to sell their homes due to financial pressure over the past two years have opted to rent instead of buying another home, and this has added to the demand and put upward pressure on rentals. In fact, the latest PayProp Rental Index shows that the national average rate of rental growth has increased from 1,8% a year at the start of 2022 to 4,4% a year currently – with the rate being even higher in some areas.”
Consequently, he says, it has become tougher for tenants to find good rental homes at affordable prices, especially in the most sought-after areas, and made them more likely to compromise on property condition and lease terms as well as the size of the property they rent.
“But they really shouldn’t do this. While not as long-term as buying a home, renting a property is also a serious financial commitment, which is why we always advise prospective tenants to rent through responsible and reputable managing agents, who will make sure that they know everything about the property and lease conditions before entering into the rental agreement – and who will also not disappear with their deposit.”
And before they even start their search for a rental home, says Schaefer, potential tenants should work through the following checklist so that they can make informed decisions and ensure a smooth and dispute-free rental experience:
*Determine a budget and stick to it. Work out how much rent you can comfortably afford and allow for utilities, some maintenance costs and a deposit of at least one month’s rent. Then look only at properties that align with your financial capability. Compromise on size or area if you must, but not on budget as this can have a negative effect on your lifestyle. You should expect your rent to increase annually by a percentage that is usually stated in your lease agreement, so pay specific attention to that.
*Check the location. Do your own evaluation of your preferred area in terms of safety, proximity to your workplace, public transport, schools and essential amenities. Visit at different times of the day and week, if possible, to gauge noise levels and the overall ambience.
*Try to view the property personally. Schedule a visit to the property with the managing agent or the landlord and inspect it for any signs of damage, pests or maintenance issues. Test appliances, taps, locks and electrical outlets to ensure they are all functional. If you are relocating from another town or country, try to get a trusted friend or work colleague to visit the property on your behalf, or get the agent to do a video walkthrough.
*Understand your lease. Don’t be rushed into not reading it properly, and ensure that you understand all of it. Pay particular attention to clauses related to rent increases, maintenance responsibilities and early termination policies. Get the landlord or managing agent to clarify any ambiguous terms or conditions before signing.
*Know your landlord or managing agent. Make sure you interact with them to gauge their responsiveness and professionalism, and establish what communication channels or procedures they expect you to use in order to get swift action regarding emergency repairs.
*Familiarise yourself with your basic rights and obligations as a tenant in terms of the Rental Housing Act, and check that the lease contains names and contact details for both the landlord and yourself; an accurate description and address of the rental property; the monthly rental amount, when it is due and how it must be paid; the lease period and any notice period required; and a clause stating that your deposit will be held in a bank account that earns interest for your benefit.
*Follow the community rules. If you are renting in a Sectional Title complex or an estate, make sure you are given a copy of the community scheme rules with regard to noise, pets, parking and use of the common areas or amenities like a pool, laundry, gym or playground. If you don’t keep to these rules, your landlord could be fined, could then pass the fine on to you and could even have grounds to cancel your lease.
*Document everything. Take photos of the property inside and out during the move-in inspection with the landlord or agent present, and make notes if necessary of any faults or damage that you notice. This will help to avoid disputes over the return of your damage deposit at the end of your lease.
Issued by the Trafalgar Property Group
