Let’s face it – within the modern economic climate, buying your own home is but a pipe-dream for many people. Between the cost of property, escalating interest rates, the bank’s reluctance to grant finance, job insecurity and, above all, the affordability problem, it’s no surprise that so many people rent their accommodation as opposed to buying their own. One of the biggest challenges facing tenants is the subject of the deposit. It is generally the norm for landlords to require the payment of a deposit before handing over the keys. The problem comes at the end of the lease, when the tenant moves out and waits for the deposit to be repaid. And waits. And waits. And waits.
Stories abound of devious landlords who happily pocket the tenant’s deposit, and then proceed to craft the most creative reasons why the tenant can’t get it back: between inflated services bills, repainting a spotless wall, cleaning carpets, repairing the rails on the kitchen drawer (that were sticking from the day the tenant moved in), changing lightbulbs, garden services, cleaning bills, changing the locks, to mention but a few of the reasons often given by landlords for refusing to return the tenant’s deposit. Understandably, tenants get rather upset about this. Especially when it is clear that the landlord has cooked up the reasons and has no intention of paying R900 to his helper, Milly, for sweeping the lounge. But human beings, being the evolved creatures that we are, tend to learn and adapt. And so it has come to pass that many tenants take it upon themselves to conveniently neglect to pay the final month’s rent, informing their landlord that they can set it off against the deposit. Which is a blatant breach of the tenant’s Lease Agreement. It can also form a blight on the tenant’s record that could impact his or her future rental prospects. And it often leaves the landlord out of pocket, especially when there are legitimate damages claims or outstanding services payments.
The challenge is to find the balance where the rights of both landlord and tenant are protected. Enter the Rental Housing Amendment Act. Section 4 sets out the provisions relating to the payment – and return – of the deposit. Here is a brief summary of these statutory requirements.
- A landlord is entitled to require the payment of a deposit from a tenant.
- The landlord must issue the tenant with a written receipt, evidencing that s/he has received the deposit amount.
- The deposit must be paid into a separate, interest-bearing account.
- The tenant is entitled to ask the landlord for written proof that the money has been deposited into the interest-bearing account, and proof of the amount of interest earned.
- The deposit must be paid back within seven days after termination of the lease if there are no damages to the rental property.
- The landlord is entitled to deduct from the deposit any reasonable costs incurred in repairing damage to the property. In this regard the landlord must make available to the tenant the relevant receipts evidencing the expenditure incurred by the landlord.
- Failure to repay the deposit is a criminal offence, punishable by a fine or 2 years’ imprisonment, or both.
Thus within 7 days after the lease has ended the lessor must reimburse pay the lessee the deposit plus interest.
It is clear from this Act that the deposit does not belong to the landlord, to do with as s/he pleases. The deposit is and remains the tenant’s money, which is given to the landlord as security, and may only be used by the landlord to cover any charges and damages that the tenant may be liable for in terms of their Property Rental Contract.
Please note that this information is supplied for general information and does not constitute legal advice. It is advisable for you to contact a legal practitioner for guidance in respect of your unique requirements.