Advice on renting out your house

As a landlord you can make a lot of money out of your property, but your tenants could end up costing you more.

We investigated the problems that property owners run into. Here's a quick guide that will help you rent your house out the right way, so that you can make the most income possible. 

Prepare for letting

A clean and polished house with modern fittings and fixtures gets rented out at a higher price.

  • Three things you should do

    • Make a list of everything you want to fix, refurbish or replace. Don’t forget about your roof, garden and fencing!

    • Prioritise your list alongside your budget and set a deadline for the makeover to be complete.

    • If you are going to use an agent, have your paperwork prepared before approaching them. This includes your ID and your spouse’s ID if you are married in community of property, three months’ bank statements/salary slips and a wish list explaining your specific requirements.

How to price your house

An agent can help price your house accurately. Tell them what you want in your pocket after commission and tax deductions. They’ll work out the final price for the property based on your needs.

If you’re renting privately, browse the market and compare what other houses in your area are asking.

You can set the deposit to be one, two or three month’s rent. If your property is small and the rent cheap, it’s better to ask for a higher deposit to make sure major damage costs can be covered. 

Finding good tenants

You’ll find tenants quickly, but you want to pick the right kind of tenants who will look after your property.

  • Here are some tips

    Using an agency will save you time and effort, as they:

    • Do full tenant background screening for you.

    • Provide legal advice and support.

    That doesn’t mean you can’t do it yourself though - it will save you money after all. Make sure you:

    • Use a registered credit bureau to perform a credit score on your tenant.

    • Ask where the tenant rented last and contact the previous landlord for a reference.

    Remember, you need written consent from the tenant to perform these checks.

Legal matters

  • For you

    • If you’re working with an agent, make sure they’re registered by checking the Estate Agency Affairs Board.

    • You’re allowed to work with more than one agency. This is better because now agencies will compete with one another to get you the best price.

    • If you have homeowner cover, you must notify your insurance company that you’ll be letting your house out.

    • You’re legally obliged to have a certificate of compliance stating that your electric wiring is in good condition and that your house poses no fire hazards.

    • According to the Rental Housing Act 50 of 1999, the tenant’s deposit must be held in an interest-bearing account.
  • For the tenants

    • The agent will provide you and the tenant with the contract. Go through it and make sure you understand and are comfortable with every clause. Both you and the tenant are allowed to make changes.

    • If you’re renting out privately, have a lawyer look over the contract.

Maintenance and inspection

Make sure your house has low maintenance to begin with. An agency will and should, do an inspection, but you can do it yourself too. Take photos to keep record of the state of the house before the tenants move in.

Tell your tenants that you’ll perform quarterly inspections on the house - and then make sure you do it. 

Ending a lease agreement

When the contract comes to an end, you and the tenant can decide to extend or terminate the lease.

  • Here are a few things to consider

    • Perform a final inspection of the house and compare it to the original photos. Remember that wear and tear is inevitable, so be fair.

    • Only release deposit once you are sure the house has no damage.

    • In case there is a dispute that you or your agency can’t settle, you can go to the Housing Tribunal. It’s free!

    • If you decide to extend the lease, you don’t have to write up a new contract. Instead you can sign an addendum to the existing one.

The more prepared you are to let your house out, the fewer problems you’ll run into, which will save you money and time in the long run. Good luck, may your property bring you great fortune!

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