Assessment & Traning Centre

December 2010

Dear Rental Readers

There are a number of options, each of which needs expanding. Those who have attended my seminars and courses are familiar with these processes.

• Your application form is the most important form of all. You need to know everything about the prospective tenant, in particular his financial background and personal references.
• The deposit. You must take as much as you can to avoid losing out to non paying tenants. I am aware that tenants cannot afford it but if they did not default, we would not have to take these advance payments.
• You must immediately contact a tenant who has not paid and find out why there is no payment
• Use the breach clause in your lease and stick to it
• Keep in mind that the longer you wait for the rent the longer it will take to get the tenant out.
• Once the tenant has not paid when the breach period has expired, an attorney should be contacted and the case handed over
• You are unable to evict a tenant yourselves - it needs an attorney to do so
• The Rental Tribunal is not a debt collector and cannot be approached to collect rent

You, as the landlord, have as many rights in terms of the Rental Housing Act as the tenant has. The chief reason as to why landlords or their agents complain about non paying tenants is that a strict collection procedure is not being followed. I have heard many cases at the end of which the tenant is given a favourable ruling only because the agent did not follow the Rental Housing Act and its expected procedure. Beware of being spun tall stories and feeling sorry for tenants - if one of those tenants goes to a supermarket and pleads that he should be given food which he will pay for when he has money, will the manager allow that to happen? You are in business and must behave in a business like manner. The rent is due and must be paid.

Your lease agreements

Having examined dozens of lease agreements I have found very few are in line with the RH Act. You cannot get a tenant to waive his right and not carry out a joint ingoing inspection or an outgoing inspection. Should you appear in the RH Tribunal, anything that has been deducted from a deposit without the necessary inspections will have to be refunded to a tenant even if the property has been left in a mess. There must be evidence of the mess to be able to claim damages.

A number of landlords and agents airily leave the Tribunal maintaining that they will not be refunding what is owed to a tenant even if the ruling has said so. Non compliance with a ruling carries a fine of R20 000 or two years imprisonment.

Renewal of leases: This is another area where the responsibility to renew is often put onto the tenant. This is your job for which you are paid a commission and you, as the letting agent, are expected to make contact with the tenant and do the necessary. Once again all it takes for a renewal of lease is a one page addendum for which there should be not charge whatsoever. Charges for this addendum are unacceptable. Do not be surprised when there are further alterations to the R H Act stipulating exactly what you may charge!

Many leases charge for inspections and receipts. You are not permitted to do so as these are laid down in terms of the RH Act and cannot be charged for. The owner of the property will have to pay for these or they must be funded from your commission.

Phone calls and visits. If you plan to charge for these you will have to charge the owner or incorporate it within your commission and not the tenant. Even if it is in your lease agreement it does not mean that it is not an unfair practice and can be regarded as illegal. The idea is to streamline your practices so well that you will not need to call the tenant often nor write frequent letters of reminder.

We have been waiting for a number of years for the amount of cash threshold in terms of cash transactions. The original act did not give an amount and at last it has been received. The details of the amendment which kicks in on 1 December 2010 are as follows:

• This act is concerned with money laundering
• The Cash Threshold Reporting provides a mechanism to report cash transactions that are over the amounts permitted
• Cash is defined as coin or paper money of RSA and any other country that is accepted as legal tender and includes traveller's cheques
• In the case of property transactions estate agents and banks must report a cash transaction to the Centre
• The prescribed amount is R25 000 or the equivalent foreign denomination
• This amount applies to amounts paid over a 24 hour period which equal the prescribed amount

For further information please go to www.fic.gov.za

We visualize holding a Rental Agents' Day before the Easter Holidays. We will organize speakers of interest, providers of services and a fun element as well. If you are interested or have a service that is useful to rental agents, please contact Debbie in this regard.

Tea with Viv

These teas have been most successful. They are held generally on the third Friday of the month at a local coffee/tea shop for an hour and a half at which only a couple of topics are discussed in depth. The groups are small enabling all questions or problems to be answered. The feed back has been most positive.

I am more than willing to go to any area and hold this event; however a minimum of 10 people will be required. Contact us if you would like one in your suburb.

Advanced Rental Course

This course will be offered next year. It is based on case studies and will involve solving a number of involved cases using your knowledge and experience. It will only be available to those who have attended our existing Residential Rental Course and will cost R1000. Further details will be sent to you soon.

Vivien & Debbie