Before Renting Your Property
Wakefields specialises in streamlining the letting process, from start to finish, including screening applicants, handling leases, and managing funds.
Know Your Market
Similar to how you would perform due diligence on a property and its condition, you should do your homework on the area's rental market to determine the demand for your property and the value of rent you can charge.
Market Your Property
Market your home so that your listing is designed to attract interest, emphasise the property’s unique characteristics and most sought-after features. As well as putting it in front of the right calibre of tenant.
Another Option for You
Wakefields specialises in streamlining the letting process, from start to finish, including screening applicants, handling leases, and managing funds.
Set Up Detailed Contracts
It essential to draft a detailed lease agreement in writing that stipulates all the necessary terms and conditions of the lease upfront, in order to avoid any misunderstandings or complications later on and avoid any legal issues. Wakefields can provide you with a relevant, up to date and legally compliant lease
Rental Inspection Checklists
Create checklists for rental inspections and all the things that need to be examined before and after a new tenant moves in.
The landlord and tenant must jointly inspect the property when the tenant takes occupation in order to ascertain the condition of the property. This list of defects must then be annexed to the lease agreement.
Perform Credit Checks & Vet Tenants
The screening process of a potential tenant is one of the most important steps in renting out your property. Vetting is the process of performing a background and credit check on a potential tenant before conferring on them the right to occupy premises.
Rental Services
When renting out a property, as Landlord, Wakefields will provide you with a signed mandate that sets out the terms of the service agreement.
Wakefields can provide the following services to you as Landlord, for a small fee or percentage of the rental income. Our experienced and reputable rental management team will make sure that your property is correctly managed.
Procurement Letting
The management of the property remains the responsibility of the Landlord, but a fee is paid to the property practitioner for procuring a suitable tenant; performing background checks and drafting a lease agreement on your behalf. With this service, the Tenant pays all subsequent monthly rentals to the Landlord and all further communications are similarly directly between the two parties.
Administrative Letting
This is a full-service option, and Wakefields will charge a monthly management fee to manage the Tenant for the period of the lease agreement. This will include rental collection and credit control, payment of utilities, all maintenance issues dealt with and full ingoing and outgoing inspections.
Rentals the #WakefieldsWay
At Wakefields, we have built our rental reputation on our commitment to always acting in our clients’ best interest. We will work with you and for you. Let us provide you with a current market assessment and give you constructive advice on how to make the best decision regarding your investment.
Get In Touch
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam, quis nostrud exercitation ullamco laboris nisi ut aliquip ex ea commodo consequat.
The Rental Process For Landlords
The rental process is well regulated by the Rental Housing Act 50 of 1999 and the Unfair Practices Regulations lays out several obligations and procedures that are applicable to residential leases. In addition, residential leases are also subject to the Consumer Protection Act 68 of 2008.
If you are intending to rent out a property, as a Landlord, it is advisable to employ the services of a knowledgeable and reputable rental expert, in order to comply with the legislative requirements.
At Wakefields, we are able to reduce the stress and hassle of renting out your own property.
One of our rental property practitioners will appraise your property and let you know what you can expect in terms of today’s rental market considering the latest data on supply and demand; comparable rentals in your area; and micro-economic factors.
Our team of qualified and extensively trained property practitioners will not only advertise your property but will also screen and vet all potential tenants, before making a recommendation to you. After you have agreed on a tenant, Wakefields will draft the lease agreement and, if you choose the administrative option, do the required pre-occupation inspections; as well as collect the deposit, 1st month’s rent, and other monies payable by the Tenant before occupation on your behalf.
Wakefield is here to guide you through the entire leasing process.
Get startedThe Rental Process For Tenants
At Wakefields, our wide range of rental properties across KwaZulu-Natal means that you are guaranteed to find a home that suits your specific requirements.
Renting a home can be a challenge. But at Wakefields, we pride ourselves on helping our clients find the perfect space that fits their needs and their budget.
Before you start looking for a place to rent, especially in high-demand areas, follow these 4 simple steps to be fully prepared:
Step 1
Check your Credit Score/Record/Report
Tenants need to have a clear credit score if they want to apply for a rental. You can build up a good score by paying the instalments on your bills (e.g., store account or cell phone contracts) on time each month. It is important to check your credit record for any inaccuracies or problems before applying for a rental. You are entitled to one free credit report from local credit bureaus (e.g., TransUnion or Experian) per year.
Step 2
Determine your affordability
While not every case is the same, as a rule, you should be earning 3 times the monthly rental. Not every rental will apply this rule as strictly but try to keep your search within this price bracket where possible.
Step 3
Gather all the necessary documents upfront
Have copies of the following documents available when you view rental spaces:
- Certified copy of your ID
- Copy of your latest payslip
- Latest three (3) month bank statements
This way, if you like the property, you can sign and complete the rental application before you leave and be the first in line to rent the property.
Step 4
Save for your deposit
If your rental application is approved, you will need to secure the lease with a deposit. A rental deposit is typically 1- or 2-months’ rent, to be paid upfront.
Advice For Landlords
ADD VALUE WITH A GRANNY FLAT
Many local freehold properties, especially in older suburbs, have an existing granny flat or the potential to add one. Often greatly underestimated by buyers and homeowners, a granny flat can add great value to a property and make a big difference to the affordability of a home.
In KZN, rentals from granny flats generally range from between R3000 to R7000 and this supplementary income is able to service a substantially greater bond. For those who don’t want tenants on their properties full time, many people are finding that they earn even more from letting granny flats out on Airbnb and similar sites.
Granny flats can also add huge value, either as a place for elderly parents or for youngsters that have not quite left home. Many homeowners have commented on how well the extended family environment has worked for them with an elderly grandparent or grandparents on hand to see children are home from school or supervise homework, the children themselves of course adding huge value to the lives of the grandparent/s.
Other homeowners with granny flats have commented on the extra security they add - the peace of mind in knowing that someone is on the property when owners are away to turn on lights, arm or disarm security beams, feed pets or generally be a presence.
While many suburban homes do have existing granny flats, others have great potential as simple and clever renovations to old staff quarters, store rooms and garages can turn dingy spaces into fabulous places. For those planning to create a granny flat, a few thoughts:
- Consult an interior designer. If you are in any difficulty about the practicalities of the transformation, interior designers often have great ideas about how to turn tricky spaces into practical working areas.
- Get plans passed. If you are making changes to an existing building, or building something from new, you will need plans passed.
- Think pre-paid. Depending on whether or not you are intending to let the flat out, you may want to consider options such as pre-paid phone and electricity.
- Think green. With the ever escalating effects of global warming, it’s worth considering the installation of water tanks and solar heating. If it’s a new build or a significant renovation, this may be a good opportunity.
- Think security. You will no doubt want some security in or around the granny flat. Consider whether this will be linked to your existing security system, or a stand-alone system for a tenant’s account.
GRANNY FLATS: A VERSATILE AND VALUABLE ASSET
GRANNY FLATS: A VERSATILE AND VALUABLE ASSET
In today's property market, granny flats are increasingly in demand among prospective buyers. Whether used as a home office, teen retreat, accommodation for grandparents, or a rental unit, these versatile spaces are more than just an extension-they're a potential goldmine. A well-designed granny flat not only enhances the property's appeal but also adds significant financial value. However, careful planning and consideration are key to maximizing its benefits.
Choosing the Right Rental Model for Your Granny Flat
Before diving into construction or renovation, it's essential to think about the rental model that best suits your lifestyle. Will the property be empty during the day, or does someone work from home? These factors, among others, will influence your decision. You could opt for a steady income from a long-term tenant, with consistent deposits into your bank account, or aim for a higher, though less predictable, income from short-term rentals like Airbnb. Each option comes with its own set of considerations, including the effort required for maintenance and tenant turnover.
Legal Considerations: Get it Right from the Start
Once you've thought through the design and costs, it's time to consider the legal aspects. Local municipal bylaws, including the need for neighbor consent, are critical. If building is involved, professional plans must be drawn up and approved by the municipality. Skipping these steps can lead to complications when selling your property, as any new addition must be reflected in the official plans.
Budgeting and Cost Management
Budgeting is crucial. The cost of building is often higher than anticipated, so it's wise to include a financial cushion. Develop a detailed budget that covers all potential expenses, from design and construction to additional security and amenities. It's also important to assess the financial viability of the project-how long it will take to recoup your investment based on the rental income you expect.
- Rental Rates: Research the going rates for similar units in your area. Consider factors such as location, size, parking, furnishings, and amenities like Wi-Fi or utilities.
- Construction Costs: Whether you're building a new structure or renovating an existing one, get accurate cost estimates. For instance, a 40-square-meter studio could cost over R300,000, excluding finishes. Renovating an existing space can significantly reduce costs.
- Funding: Decide whether you'll finance the project through cash, an access bond, or a loan. Be sure to factor in interest costs and calculate how long it will take to pay off the debt with your expected rental income.
- Cost-Saving Strategies: Creativity can go a long way in keeping costs down. Explore minimalist designs and less expensive materials, and consider upcycled furniture or second-hand finishes.
Understanding Market Demand
There is a strong demand for small, affordable rental units, especially in areas near business or transport hubs. Permanent, reasonably priced units are rarely vacant for long. Some tenants prefer the privacy and independence of a granny flat over a traditional apartment. To maximize your rental potential, know your market and tailor your offering accordingly. Research the needs of your target audience, whether they're local tenants or international visitors, and ensure your unit meets their expectations.
Enhancing Tenant Appeal
If you want to command premium rent, focus on the details. Offer amenities that tenants appreciate, such as air conditioning, quality linens, and high-speed Wi-Fi. Provide thoughtful touches like a coffee machine, emergency lights for power outages, and information on local attractions and services. Being responsive and available to address any issues will also help secure positive reviews and repeat business.
Tenant Screening and Security
Securing a tenant through a reputable rental or estate agency is ideal, as they have the tools and expertise to conduct thorough credit and reference checks and provide a robust lease agreement. If you choose to manage the process yourself, be diligent in your screening. Insist on a two-month deposit, verify references, and have a clear, written agreement outlining rules regarding occupancy, noise, pets, and other important aspects. Remember, you're entrusting someone with your property, so ensure they share your commitment to maintaining it.
RENTING - THE GOOD, BETTER, AND BEST NEWS
Wakefields puts the residential rental market under a microscope
The good news is that, according to data gathered for the last quarter of 2019 by TPN Credit Bureau's Vacancy Survey, the KZN rental market is relatively stable. The TPN Vacancy Survey recorded a national vacancy rate of 8.97% for the fourth quarter of 2019, but KZN fared better than most with a 5.9% vacancy rate - it's a significant improvement, and places landlords in a more favourable position. "Countrywide," says TPN, "the scales remain tipped in favour of the tenant, which leaves the landlord seeking innovative ways to overcome the prevailing challenges. "
Of course, some suburbs or parts of suburb are more in demand than others, which means some areas have an oversupply, others an undersupply. Landlords have to think twice about their rentals and annual increases, and equally, be creative about their rental offering so it's more attractive to tenants than the flat next door.
TPN describes the under R3 000 category as the strongest for landlords, because demand is high in that price band. The next band of R3 000 to R7000 comes out second best, followed by the R7 000 to R12 000 band. Rentals over R12 000 have the highest vacancy rates.
Currently, Wakefields' branches and rental division report an uptick in prospective tenants. Reasons? Some because their landlords are selling, others because of unrealistically high rental increases, and others who can no longer afford the rental they've been paying. They report too, that garden cottages continue to be popular, and in short supply. Corporate rental enquiries have risen, in particular in areas such as Umhlanga and Scottburgh.
Wakefields' rental division notes that landlords who aren't achieving the rentals they'd like, are utilising as many rental agencies and online platforms as possible to find a tenant who will pay that rental. That's not always an advisable approach, as tenants need to be very stringently vetted - a tenant with a poor credit history can slip through the net, and the landlord is then left with a delinquent tenant. Wakefields has very stringent rules for placing tenants, and although that may mean it could take longer to find a tenant, it's absolutely critical to find the right tenant.
For landlords and tenants, the market requires understanding. Overpricing a rental often results in vacancies; over demanding tenants often results in no rental. The property market is very reactive to the economic climate, and tenants and landlords need to be and do likewise.
THREE WAKEFIELDS BRANCHES
Three branches in KZN discussed their rental divisions:
Who is renting?
The market here is dominated by those who have yet to qualify to buy, and they are looking for rentals in the lower priced band as described by TPN.
State of your rental market
Although we have a good supply of one bedroom rentals in the region of R4000 coming on to the market, they're let in a matter of days. The demand there is high, and we can't keep up with it.
Slower to be let out, are four bedroomed houses In the R12000 and over bracket, a sector which TPN pinpointed as less in demand.
Tenants or landlords?
We have more tenants than properties, so demand is high. Importantly, tenants won't pay 'overpriced' rentals - most are well aware of the going rate for rentals in a particular area.
Tenants are choosing to remain in the property they're currently renting, rather than move - it's more cost effective than funding a new deposit, or the often tricky retrieval of their current deposit from a reluctant landlord.
For landlords in this area, most tenants find a 10 percent rental increase too high. Six percent is the figure most tenants can bear. Low salary increases and the high cost of living is impacting on this sector of the market.
Who is renting?
Many are corporate overseas clients. Security is a major driver for them, and The Pearls answers those concerns.
State of your rental market?
Demand is very strong, with considerably more leases being signed now. Most owners do not want to sell as they consider these apartments to be investment properties, and prefer to rent them out.
We have not seen much in the way of rental increases year on year for the last four years in this upper end of the market (about 10 percent over that period) - it's the most sensitive sector, as per TPN, and although we're experiencing demand, there's no appetite for overly high rentals. Increases are only likely to happen when supply decreases. When Pearl Sky launched, 500 units came on the market, so there was an oversupply - that will always depress rentals, but recently, demand for the apartments has risen noticeably.
Tenants or landlords?
The demand is certainly there for those landlords who have come to terms with market-related rentals. Our tenancy rate has increased, but tenants aren't accepting substantial annual increases.
Who is renting?
Mainly medical staff at the new hospital, and enquiries are escalating for student accommodation for the new educational facility on the cards.
State of your rental market
Rental demand, both commercially and residentially, is high - the amount of interest immediately generated when a rental property is available has definitely increased.
Two thirds of our demand is for sectional title property rentals in the R3000 to R7000 band, and one third for freehold houses in the R7000 to R12000 band.
Landlords or tenants?
There has been downward pressure on rentals, both commercially and residentially. Landlords are competing for new good tenants and encouraging existing tenants to stay at renewal time, so rather than increase rentals, they're offering to maintain them at the same level for a period of time. The rental rates have on average held steady over the past few years.
Five Tips for Tenants looking to rent:
- Understand that there is a process involved and plan ahead - you will not be able to see a property today and move in tomorrow.
- Know who your rental consultant is - ask to see their Fidelity Fund Certificate, visit them at the agency. Don't take it at face value that the person you are meeting at the property is a genuine rental consultant.
- Never hand over cash to anyone. Do an EFT and make sure you get the bank details directly from the rental agent (that you have now ensured is authentic).
- Know and understand your lease before signing, and if there is anything you're unsure about, ask for an explanation.
- Insist on everything in writing, and that it forms part of the lease. For example, if you request work done before you move in and the Landlord agrees, ensure it is recorded under the Special Conditions clause (all lease agreements should have a clause like this) with specifics - details of what was agreed and by when.
Five tips for Tenants already renting:
- Most important - pay your rent on time and in full. There are so many checks in place now that it is not hard to find out what your rental payment history is and, if you are not prioritising your rental payments, you will battle to find a new home to rent if and when it comes time to move on.
- Ensure you have an open and healthy relationship with your Landlord. Don't become unreasonably demanding - the relationship will fracture.
- Be aware that the property you are renting is an investment for your Landlord - that is how he will always view it when there are tenant's demands or costs.
- Do not withold your last month's rent and expect the deposit to be used in lieu - this is against the law and could mark you as an unreliable tenant. The deposit is a damage deposit and is to be used as such.
- Don't trouble your Landlord with small issues you could easily fix yourself. That way, when you do have a problem you really need him to fix, he is likely to be far more willing.
5 TIPS FOR BUY-TO-RENT INVESTORS
When purchasing property with the intention of renting it out, there are several key factors to consider to ensure your investment pays off. Here are the golden rules suggested by Myles Wakefield, CEO of Wakefields Real Estate.
Here are the five golden rules to follow when considering buy-to-let investments:
1. Define Your Investment Goals
Start by asking yourself: what am I hoping to achieve with this investment? If you're looking for a quick profit, you'll need to be astute in your decision-making. However, if you're aiming for a long-term investment, the timing of when to sell is more crucial than the timing of when to buy.
2. Don't Let Emotions Drive Your Decisions
While it's tempting to fall in love with a property in an area you like, property investment should be approached as a business, not a personal preference. It's important to stay objective and avoid overpaying for a property.
3. Timing is Key
When to invest can be tricky. While it's easy to say "read the market," market cycles often dictate the best times to buy. Typically, property investment is a medium- to long-term endeavor, with capital appreciation coming over time. Unless you're in the midst of a market boom, you'll want to hold on for the long haul.
4. Securing the Right Tenant
This is one of the most critical steps in the process. While you can choose to manage tenant selection yourself, it requires thorough vetting which can be time-consuming and complex. A skilled rental agent can help you find a reliable tenant by using online tools to ensure they have a solid credit history and positive rental references.
5. Do Your Research
Take the time to understand the rental market in the area you're considering. What rental prices are other properties in the area achieving? What types of properties are in demand? You should also research the local industries and employment trends to assess housing needs. A well-priced property that matches the demand in the area will ensure minimal vacancies.
6. Location Matters
Always consider the demand for properties in your chosen location. For example, if investing in a lower-priced area, ensure there is easy access to public transport, schools, and shops. For higher-end properties, check if there is sufficient parking space. Also, consider how close the property is to your home or work if you plan to manage it yourself.
7. Crunch the Numbers
Ideally, the rent you receive should cover your home loan, levy, and maintenance costs. It's also wise to have some extra funds set aside to cope with potential bond rate increases or unexpected expenses. Securing the best possible interest rate on your home loan and making a sizable deposit can help keep monthly costs lower. Remember to track all expenses, both initial and ongoing, to ensure your investment remains profitable.
Understanding Rental Yields
Rhys Dyer, CEO of ooba Home Loans, explains that rental yield is a key metric for buy-to-let investors. It's calculated by dividing the annual rent by the property's value, expressed as a percentage. For example, a property worth R1 million with an annual rent of R120,000 (R10,000 per month) would yield a 12% return.
If you find the right property and secure favorable financing, a rental yield of 5-10% is achievable, depending on your location and market conditions.
LETTING - A JOB FOR THE PROFESSIONALS?
Whether you're a tenant or landlord, the letting and renting process requires smart and meticulous management. Are you prepared for the challenges, or is it time to call in the professionals?
The past few years have been financially and emotionally challenging for many. Difficult situations, like retrenchments or divorces, often lead people to seek shortcuts in legal and ethical processes. Without experience, it's easy to fall prey to potential pitfalls. A professional rental agent knows where to look for transgressions and ensures thorough checks on background information, documentation, and references to protect both landlords and tenants.
Why Use a Professional?
Renting out your property might seem straightforward, but it can quickly become complex. Without legal knowledge, access to IT systems, and experience managing people, problems can spiral out of control. A skilled property practitioner ensures that everything runs smoothly, from drafting watertight leases to addressing emergencies effectively.
Professional agents also provide an invaluable service by being responsive and proactive. In today's market, tenants and landlords expect quick replies across various platforms, and good agents deliver this consistently.
Advice for Landlords
- Find Quality Tenants: Look for tenants with a proven track record, a good credit rating, and a steady income of at least three times the rental amount.
- Maintain Your Property: A well-kept property attracts better tenants willing to pay higher rentals.
- Price Correctly: Setting a fair rental price ensures your property is occupied, generating consistent income while avoiding long-term vacancies and associated risks.
- Retain Good Tenants: Keep reliable tenants by addressing maintenance issues promptly and limiting rental increases. Finding a new tenant can cost more than retaining a current one.
- Prepare for Emergencies: Keep funds in reserve for unexpected repairs and maintenance.
Why Work with a Reputable Agency?
- Expert Management: A registered agent ensures your investment is managed according to legal and industry standards, reducing risk.
- Navigating Complex Legislation: South Africa's rental laws can be confusing. A professional agent ensures compliance in all scenarios, such as early lease terminations or tenant evictions.
- 24/7 Support: Avoid late-night calls for emergencies like burst geysers or flooding-your agent handles it all.
- Seamless Processes: Inspections, deposit handling, and move-out procedures are managed professionally.
- Tenant Accountability: Agencies registered with TPN (Tenant Profile Network) monitor tenant payment histories, ensuring reliability and protecting your property.
Working with a fully registered agency offers peace of mind, legal protection, and professional management. By entrusting your investment to experts, you're safeguarding your property and ensuring the best outcomes for all parties involved.
Whether you're renting out your property or searching for your next home, choose knowledge, transparency, and professionalism to make the process as smooth as possible.
Advice For Tenants
Questions to ask when Renting
When you are looking at property, there are some important questions to ask when renting a house or an apartment. These questions will equip you with some of the more important information enabling you to make a sound decision that is right for you and/or your family. We suggest asking: Have the locks been changed or are all of the keys accounted for from the previous tenant/occupant? Not all landlords change the locks to a property but rather count on previous owners turning in all the keys. You might want to ask for the locks to be changed, or ask if you can change them. This will protect you in the future if there are any extra keys unaccounted for by the property owner. What is the likely average monthly spend on utility bill(s) to run this property? In the event that electricity and water are not covered in your rental, knowing an estimate of these costs prior to signing the lease agreement will assist you to budget thoughtfully and manage your consumption in line with these estimates. The account that you will be responsible for at the end of the month will always be based on your individual consumption, however, it is worthwhile bearing in mind that a particular property may require a higher consumption to run and maintain, say, a large garden and a swimming pool as opposed to a granny flat that does not have either of those amenities. What is the expected rental payment date? Conventionally, rental is paid on or before the 1st of every month, however, this is a convention and not a rule. It is worthwhile knowing what the landlord's expectations are with regards to the payment date in order to assess whether you can meet this based on the date you are paid your salary or income from which you will service your rental amount. Are there any rules relating to parking? If you are looking to rent a unit or a home that is on a shared property (for example, the Landlord has subdivided a house in to multiple living units), you may want to enquire about any rules related to parking, including how many cars your unit is able to accommodate. This will avoid any major conflict areas with other tenants on the property in future. If you are renting in a formal complex or sectional title scheme, these rules will more than likely be decided by the body corporate and therefore you should ask to see a copy of these rules. Are pets allowed? There is no rule that suggests that pets are automatically allowed on or n the premises that you are planning to rent. Therefore, asking this question upfront will help you to know whether the property is suitable for you. You may find that some pets are more acceptable to the landlord than others or that the landlord will restrict the number of pets. These are likely to be made a term of the lease agreement so be sure to not infringe on these terms. Can I have a copy of the complex conduct/house rules? If you plan to rent in a complex or sectional title scheme, you should obtain a copy of the complex conduct or house rules in advance of signing the lease agreement. This will guide you to understanding the rules of the complex or scheme with respect to pets, noise, parking, use of common property, maintenance, visibility of washing lines etc. It is very important to understand these rules as contravening them will likely result in a fine or some other form of recourse taken against you. Wakefields' team of professional rental property specialists are here to assist you with all your letting questions and queries. It is time to rent the #WakefieldsWay Email rentals@wakefields.co.za
Renting a Property with a Poor Credit History
When renting a property with poor credit, you should keep a few things in mind. This does not automatically disqualify you from renting, however, there are some important pieces of information you may want to be aware of. On application to rent a property, your rental agent is obligated to run a credit check. We suggest being honest and upfront about your credit history and provide any explanations for a poor credit to the agent who can take this information to the landlord in motivation of your lease agreement. Take action. If you do have poor credit, and you are worried that this may affect your ability to rent a property, we suggest taking immediate action to improve your credit wherever you can. Poor credit history does not automatically mean that a landlord will not rent to you. Your lease application as well as supporting information (such as your credit history) will be presented to the landlord who will use his/her discretion in awarding you the lease agreement. The more information your agent has with regards to your credit history the better. Poor credit history may mean that the landlord will look for more security. If the landlord chooses to award you the lease agreement in the context of your poor credit history, it is understandable that he/she may do what he can to minimise this risk. This may mean that the landlord could ask for a 2- or 3-month deposit rather than a one month's damage deposit. He/she may also call for a utilities deposit. Being able to provide these securities may make you a more attractive risk to the landlord in question. Wakefields' team of professional rental property specialists are here to assist you with all your letting questions and queries. It is time to rent the #WakefieldsWay Email rentals@wakefields.co.za
Real Estate Terms
Real Estate terms got you perplexed? See our comprehensive glossary to guide you in understanding common terms used in a real estate transaction relating to rentals. ABANDONMENT The surrender or relinquishment of a real estate property, including a piece of land or a housing unit. ALIENATION In the context of real estate, 'alienation' refers to the sale, exchange of donation of immovable property (or, 'land') and commonly used in some sale agreements as well as the legislation referred to as the Alienation of Land Act 68 of 1981. AMENITIES Material and immaterial features of a given property that increase its value or make it more desirable. APARTMENT A residential unit inside a structure built for housing. AUCTION This refers to the method of selling a property to a person who makes the highest bid. BODY CORPORATE The controlling body of a sectional title scheme made up of every single owner of the various units in the scheme. Until such time as the developer has sold the last unit, he remains a member of the body corporate. BODY CORPORATE RULES Rules for the control, administration and management of a Sectional Title scheme. BREACH OF CONTRACT If either a Landlord or Tenant does not perform according to the terms of the lease agreement they have signed, they are deemed to be "in breach". Under these circumstances, the agreement usually states what rights the other party enjoys. CODE OF CONDUCT A set of ethical rules drawn up by the Property Practitioners Regulatory Authority (PPRA) to regulate property practitioners' ethical conduct. This code is enforceable by law through disciplinary committees appointed by the PPRA. COMMON PROPERTY In a sectional title complex, common property is the land on which the buildings are built, together with those parts of the building that are not included in a particular section, i.e., stairwells, lifts, carports, swimming pools, etc COMMISSION The professional fee (commonly expressed as a percentage of the selling price) property practitioners charge for carrying out real estate duties such as selling, letting etc. COMPARABLES A part of a valuation technique that determines the value of a current asset by using a recently sold asset similar enough for indicating the expected sale price. CONTRACT A legally enforceable agreement, i.e., a lease agreement. CONTRACTUAL CAPACITY The capacity that the law recognises a contracting party enjoys in order to enter in a contract lawfully. CURB APPEAL A concept expressing the attractiveness of the house's visual look as viewed from the street level. DEFECTS A Patent Defect is a defect in the property that is clearly visible to the naked eye. A Latent Defect is a defect which exists but is not visible or discoverable upon a reasonable inspection of the property and which impairs its utility of effectiveness. DOMICILE The official physical address that a party to a contract nominates as being one's place of residence and where one can receive legal process, such as receiving of summons. In a contract, this will formally be referred to as the domicillium citandi et executandi. DEPOSIT The rental deposit is usually equal to one month's worth of rent, although it might be more. The landlord and tenant will agree on an amount. The landlord is required by law to invest the rental deposit in an interest-bearing account. A payment collected from the tenant by the landlord to secure funds for covering any property damage. DUPLEX A sectional title unit on two levels with stairs. EVICTION A legal process for the removal of a person from their current home. The reasons include lease agreement violations and unpaid rent. EVICTION NOTICE A legal notice from the landlord that describes the tenant's default connected to the lease terms. Eviction notices aim to inform tenants of a pending eviction suit against them. EXCLUSIVE USE In a sectional title property, the owner of a specific unit cannot become the exclusive owner of a portion of the common property but for his ownership of his undivided share. Certain portions can be set aside for the exclusive use of a particular owner (e.g., parking bay or garden) and this could be done either through Body Corporate Assignment or a Notarial Deed of Cession. FREEHOLD A free standing house on a plot of ground with its own Lot or Erf no. HOMEOWNERS ASSOCIATION (HOA) An organisation consisting of homeowners residing in a specific estate or complex with an aim to create and enforce guidelines and rules in the building. INVESTMENT PROPERTY A property that is purchased by the owner to generate profit through renting the property out to tenants. LANDLORD An owner of a property who receives payments from tenants taking residency in the owned rental unit. LEASEE A contract outlining the terms and conditions between a landlord and tenant under which the tenant gets an exclusive right to use the home for a fixed term. In turn, the landlord receives payments for the duration of the contract. LEASE OPTION An agreement that provides the tenant with an option to buy the property during or at the end of their tenancy. This agreement prevents the owner from selling the property to any third parties until the lease expires. LEASE RENEWAL The continuing of the lease after its initial expiration. LEASE TERM The time restriction regulating a tenant's right for the home's exclusive possession. LEASING AGENT A person, namely a property practitioner, who leases real estate properties and signs them on behalf of the lessor. LESSEE A tenant who rents the property from the landlord. LESSOR A landlord who grants the lease to the tenant. LEVY An amount paid monthly by the owners of a sectional title unit to the sectional scheme for the running and maintenance of the scheme and can cover costs such as insurance, maintenance, security etc. LONG-TERM RENTAL A long-term lease is often defined as anything that is agreed-upon for more than one year. MAINTENANCE An umbrella term for regular activities that keep the property in good condition. MANDATE An instruction or authority given to a property practitioner to render a particular estate agency service for a client for which the agent will receive remuneration. NOMINEE A person nominated or appointed by another person for a specific purpose. NULL AND VOID Without any legal effect. An agreement of lease that is null and void is not valid in any respect and cannot be enforced by either party. OCCUPATION The right to be physically present on a property. A Seller must give a purchaser occupation of a property, which means that he must remove his furniture and hand over the keys so that the Purchaser can take actual occupation. PROPERTY A real estate asset that includes land and any accompanying permanent structures, such as houses or other buildings. PROPERTY INSPECTION A visual inspection of a building that has to be carried out by a qualified professional in a non-invasive manner. PROPERTY MANAGEMENT AGREEMENT An agreement clarifying the service, responsibilities, and payments that will be signed by the landlord and a property management company. PROPERTY MANAGER A person managing a real estate property that belongs to someone else. Property managers get compensated for dealing with accounting, maintenance, and rent collection among other duties. PROPERTY SHOWING (aka SHOW HOUSE) A scheduled appointment that allows prospective tenants to make a walk-through tour in the property. REAL ESTATE A portion of land that may or may not have attached permanent structures, such as buildings. RENT COLLECTION An activity that is undertaken by the landlord or a property management company to collect the money from each of the tenants under the terms stated in the lease agreement. RENT-TO-OWN A lease agreement that provides the purchasing possibility to the tenant. RENTAL DISCOUNT A discount given by the landlord to the tenant when certain previously agreed criteria are met. For example, the discount could apply on automatic lease renewal. RENTAL PROPERTY A property occupied by tenants who pay the owner in return for utilising the living space and any permanent or temporary attached fixtures. RENT RATE An amount of money the tenants have to pay to landlords over a fixed time period for renting a property. REPAIRS An action to fix broken or obsolete pieces of the property, including any fixtures inside the living space. RESOLUTIVE CONDITION A clause in an agreement of lease in terms of which the agreement will become null and void only if the event stipulated in the clause occurs. It is the opposite of a suspensive condition, (see note under Suspensive Conditions). RETURN ON INVESTMENT (ROI) A metric that shows how much profit an investor makes on the investment property as a percentage of the investment cost. PROPERTY PRACTITIONER (previously REAL ESTATE AGENT A qualified professional who leases and sells real estate properties. SECTIONAL TITLE The Sectional Titles Act 95 of 1986 made it possible, in the case of a block of flats, for each unit to be owned by a different person. SEMI-DETACHED Two separate homes side by side joined together, with one common dividing wall. SERVITUDE A registered right which a person/entity has over the immovable property of another. It usually entitles the holder of the servitude to do something on the property. A common example is a registered right of way to travel over property owned by another. SHAREBLOCK Under a shareblock scheme a person acquires a share in a company entitling him to use and occupy a specific apartment, flat or office, in a building owned by the company, which is a shareblock company. This differs from sectional title as the owner does not become the owner of the unit, but merely acquires the right to use and occupy it. SIMPLEX A sectional title unit on one level. STSMA Sectional Title Schemes Management Act 8 of 2011. SUB-DIVISION When land is sub-divided, it is divided into two or more portions. A specific legal and technical procedure must be followed. SUB-LETTING Renting a property by a tenant to a third-party tenant for a specified segment of the tenant's lease agreement. SUSPENSIVE CONDITION A clause in an agreement of lease in terms of which the agreement would become enforceable only if the event stipulated in the clause occurs. TENANT A person occupying or temporarily possessing a land, building, or a specified unit under an agreement with the landlord for a fixed period. TENANT APPLICATION An application that has to be filled out by a potential tenant in case of interest for a particular rental property. TENANT DAMAGES Any damage occurring during the lease term that isn't considered as normal wear and tear. TENANT SCREENING A process carried out by the landlord or a property management company to verify the background of a potential tenant. The process may include a credit check, interviews, and background check. TITLE DEED A legal document showing proof of ownership, filed in a deeds office, containing details of the property and its owners. TOWNHOUSE A house of usually two or three stories that connects to matching houses by a shared wall. TRUST A trust is not a legal entity as such and cannot enter into an agreement in its own name. All agreements binding a trust must be concluded by the Trustees of the Trust, authorised in writing by the Master of the High Court. TRUST ACCOUNT A bank account in which the account holder holds money in trust for another person until occurrence of a certain event. The money in such an account is referred to as trust money. Every estate agency business must have a trust account which must be audited by an auditor every year. TURNKEY PROPERTY A residential property that requires no urgent investments by the buyer and can immediately be rented out after purchase. UTILITIES The services provided for people residing in a property, including electricity, refuse collection and/or water. VACANT PROPERTY A property that lacks any people and personal property inside. VACATION RENTAL A rental property that is fully furnished and rented out to guests for short-term periods (e.g., two-week holiday). VIRTUAL TOUR An online means to presenting a property to prospective tenant, often in the form of videos or interactive media content. WALK-THROUGH INSPECTION An inspection carried out by the landlord during the move-in and move-out procedures to document any damage, missing items, and other issues in the rental property. ZONING Zoning limits the purpose for which a property may be used (e.g., residential, commercial, industrial etc.)
Property Renting Checklist: A Guide for Tenants
Before you begin your property search, having a checklist in hand will help guide your decisions and ensure you're well-prepared for the renting process. A checklist allows you to assess a property's condition, clarify your responsibilities, and determine if it's the right fit for you. Follow this checklist to make an informed choice. Property Condition & Amenities Start by evaluating the property's condition. Check the walls, bathrooms, kitchen, and any appliances included in the lease agreement. Pay close attention to the flooring-ensure carpets are clean and wood floors are free from damage. If any issues exist, make note of them on the lease report. Next, consider your essential living requirements: How many bedrooms and bathrooms do you need? Do you require entertainment space or an open-plan living area? Is a swimming pool a must? If so, do you need it to be secured by a fence or net? Would you prefer a single-level property, or are stairs acceptable? Garden Space If you need a garden, consider the size and whether it needs to be secure. Will a large lawn area for children to play be necessary? Do you need the garden to flow from the living or entertainment areas, or is it acceptable for it to be located at the back of the property? Parking Facilities Consider your parking needs: How many parking spaces do you require? Do you need space for larger items like a caravan, trailer, or boat? Make sure to verify whether your specific parking needs align with the lease agreement or, if in a complex, the body corporate rules. Pets Planning to rent with pets? Your checklist should address whether pets are allowed, the number and types of pets permitted, and any conditions the landlord might impose. Additional Amenities Some properties may offer specific amenities that you'll need: Wifi, security and alarm systems, CCTV, or baby gates. Gas installations for stoves or ramps for wheelchair access. Find out if these amenities are already in place or if you can negotiate installation with the landlord, documenting any agreed-upon changes in the lease or an addendum. Important Reminder This checklist is intended to guide your search but does not replace an official property inspection. For the security of both the tenant and landlord, the property's condition must be formally documented during occupation and vacating. For professional rental assistance, the team at Wakefields Real Estate is ready to help with all your letting queries. Rent the #WakefieldsWay. 📧 Email: rentals@wakefields.co.za