New bill to change SA rental market

29 Aug 2014

Recently tabled in the National Assembly, the proposed Rental Housing Amendment Bill could bring about some significant changes in the rental market for both tenants and landlords.

The Rental Housing Amendment Bill could be used as an excellent tool to form a pro-forma lease agreement stipulating the minimum rental agreement criteria.

One of the major changes that the bill puts forward is that all lease agreements will have to be reduced to writing, which the advocates of the bill say will assist in protecting both parties. The onus will fall onto the landlord to ensure that a written agreement is drawn up.

“Preceding the proposed bill, the Rental Housing Act of 1999 did not stipulate that the lease agreement had to be a written document unless the tenant requested it and many lease agreements were entered into with only a verbal agreement.”

He says if the bill is passed, the written lease agreement will become a binding legal document that would be enforceable in a housing tribunal or a court of law. This would require the establishment of rental housing tribunes across the country in all provinces, along with rental housing information offices in each municipality.

“One of the principle objectives of the proposed bill is to do away with tenants being asked to pay additional costs that have not been previously stipulated within the rental agreement. The bill will require that a tenant is liable for the amount of the rental, along with any other additional charges agreed upon in the lease upon the due date, however, for costs other than those agreed upon, the tenant is only liable upon proof of factual expenditure by the landlord.”

As per the proposal, tenants will also have the right to request a written receipt from the landlord for all payments received by the landlord from the tenant. The receipts must include a date, an address with street number or description of the property they relate to, as well as an indication of whether the payment was for rental, arrears, deposit or otherwise and a specific period for which payment was made.

“Additionally, tenants will be within their rights to request that the landlord provide them with written proof in respect of the interest accrued on the deposit paid. The landlord will be required to invest the deposit amount received from the tenant in an interest-bearing account with a financial institution - provided that the rate applicable to such account may not be less than the rate applicable to a savings account. Provided there are no outstanding monies owed to the landlord upon the expiration of the lease, the deposit without deduction, along with any interest accrued will be paid back to the tenant within a seven day period.

“In the instance where the tenant has caused damage to the property or lost keys, the landlord may deduct the necessary reasonable costs from the deposit before it is paid over to the tenant. It must be noted that when a tenant rents a property through an Estate Agency that the interest is payable to the Estate Agency Affairs Board,” 

Some of the other stipulations within the bill include that the tenant has the right to privacy, with the landlord providing the tenant with a reasonable notice period before they exercise their right to inspect the rental property. Included in the tenant’s right to privacy is the fact that the tenant or dwelling may not be searched, and their possessions may not be searched or seized, except in terms of a law of general application and having first obtained a ruling by a tribunal or an order of court. Tenants also have the right to not have their communications infringed in any way, he says.

“While the tenant has the right to privacy, they are also obliged by the bill to make themselves available on request of the landlord in order to conduct a joint inspection of the rental property at a time that is convenient to both parties. The inspection will be to ascertain if any damages have been caused to the property while the tenant has lived there,” says Goslett, who notes that a joint inspection will  also be required before the tenant moves into the dwelling, as well as when they move out.

According to the bill, landlords are required to provide the tenant with a property in a habitable condition, maintaining the existing structure of the property and wherever possible facilitating the provision of basic services. “Landlords will need to ensure that their rental property meets the required standards and is a structurally sound dwelling that provides the tenant with protection from the elements as well as other health and safety issues.”

Rental Housing Amendment Bill could be used as an excellent tool to form a pro-forma lease agreement stipulating the minimum rental agreement criteria. The amendments within the bill would act as a guideline and standard for agreements between landlords and their tenants.