Bad tenant indicators

Many landlords only realize a tenant is problematic after they move in, complicating eviction. While seasoned landlords trust their instincts, new landlords can learn to spot red flags.

Screening and credit checks: High-risk tenants will be immediately obvious when doing the standard credit score check and putting them through a screening.

Tenant red-flags

Potential bad tenants that, on paper, seem ideal often ask questions, make requests, or demonstrate characteristics that should set off alarm bells. These include:

• Asking you to skip the screening process and credit check.
• Offering to provide you with their own credit report.
• Relentlessly haggling over the monthly rental or deposit.
• Having a record of moving too frequently.
• Obviously lying about their financial health (revealed during credit check). More on avoiding bad tenants.

Signs that a tenant may be difficult

Beyond the obvious red flags, certain indicators may reveal problematic personality traits or habits. Look out for the following:

• They arrive drunk at the viewing or smell of alcohol.
• They speak loudly enough to disturb potential neighbors.
• They express dislike for pets or children, which can be a serious issue in apartment buildings.
• They are vague about their employment, past or present.
• They refuse to share details about their employer or job specifics.
• They provide only relatives as references.
• They are reluctant to sign a lease or delay signing until the last minute.
• They speak poorly about previous landlords.
• They refuse to share details about who might stay over.
• They are moving for a job that is not yet confirmed.

How to say no to a tenant application

Rejecting a tenant application can be sensitive, and applicants may misinterpret the reasons, which is why it is good to approach it with sensitivity. Ideally, the rejection should be in writing, thanking the applicant and explaining that their application was unsuccessful. While you are not required to provide a reason, landlords may cite factors like the tenant’s credit score or property rules, such as not accepting pets.

Any rejection letter, whether sent by email or text, should be considered a legal document.

What landlords can do when tenants break their lease early

Tenants may sometimes want to end their lease agreement before the contract expires. However, whether they can do so without breaching the lease depends on the cancellation clause in the agreement.

Cancellation clause example

1. Cancellation by the Tenant

1.1 The Tenant may cancel this lease agreement at any time by providing the Landlord with no less than 20 (twenty) business days' written notice, as stipulated in terms of Section 14 of the Consumer Protection Act, 2008 (the CPA).

1.2 The Tenant acknowledges that such early termination may result in reasonable penalties as outlined in the CPA, which the Landlord may charge to cover any loss suffered as a result of the cancellation, including but not limited to:

• Loss of rental income,
• Costs for advertising the property, and
• Agent commission fees incurred to secure a replacement tenant

1.3 The Tenant shall not be liable for penalties if the early termination is due to a breach of material obligations by the Landlord, including but not limited to failure to maintain the property in a habitable condition.

The importance of the cancellation clause

If a lease agreement includes a cancellation clause, the tenant may have legal grounds to terminate early. If not, they are typically considered in breach of contract, and the landlord can demand payment for the remaining rental period unless an agreement is reached. This might involve subletting or finding another tenant to take over the lease.

How the Consumer Protection Act (CPA) impacts early termination

According to the Consumer Protection Act (CPA), tenants can cancel a lease with 20 business days’ notice, even before the lease ends. However, this does not absolve the tenant of all responsibilities. Landlords can recover reasonable costs incurred while searching for a replacement tenant, such as advertising costs and agent fees. It is crucial for landlords not to charge exorbitant amounts or withhold deposits unless there is substantial property damage.

When the landlord is in breach

If the landlord has failed to meet their obligations (e.g., failing to maintain the property or allowing it to become uninhabitable), the tenant can legally terminate the agreement without paying penalties. The tenant must prove that the landlord is in breach of contract.

Cancellation clause example

1. Cancellation by the Landlord

   1.1 The Landlord may cancel this lease agreement with immediate effect if the Tenant:

   • Breaches any material term of this agreement,
   • Fails to make payment of rent or any other amounts due under this agreement within 7 (seven) days of written demand, or
   • Conducts illegal activities on the premises.

   2.2 Should the Landlord cancel this agreement due to the Tenant's breach, the Landlord reserves the right to claim for any damages or losses incurred as a result, including but not limited to loss of rental income for the remainder of the lease period.

End of the lease agreement

Tenants nearing the end of their lease should check for a renewal clause to see how much notice is required. If a tenant stays on after the lease has expired, it is considered that a new lease has been entered into by default. Without a cancellation or renewal clause, the tenant must give the landlord at least one month's notice before terminating the agreement.

Strategies to collect unpaid rent from tenants

Handling tenants who fall behind on rent can be challenging, but with the right approach, you can effectively recover outstanding amounts. Here are three useful strategies:

1. Supporting tenants in financial distress

• Open communication: Contact the tenant to understand why they missed their payments. Situations like job loss might be the cause.
• Offer solutions: Negotiate a manageable payment plan or consider offering alternative accommodation if the tenant’s situation doesn’t improve.
• Document everything: Ensure any new payment agreement is put in writing to protect both parties.

2. Addressing non-compliant tenants

• Issue formal notices: If rent is overdue, send a written notification within seven days, following legal requirements.
• Identify the problem: Investigate if maintenance or other concerns are contributing to non-payment.
• Use legal channels: Refer to the lease terms and, if unresolved, escalate the matter through the Rental Housing Tribunal.

3. Dealing with tenants who refuse to pay

• Serve a legal notice: Provide a written demand for payment, giving the tenant 20 business days to settle the debt.
• Follow eviction procedures: If the tenant doesn’t resolve the issue, you may cancel the lease and initiate eviction in accordance with the law.
• Pursue legal action: Consider filing a claim through the Small Claims Court for amounts under R20,000, or seek legal assistance if needed.

Always ensure you follow legal processes to recover unpaid rent and protect your rights as a landlord.

Following the eviction laws and regulations from the start will ensure the process is handled more efficiently.

Legal Process for Evicting Squatters in South Africa

In South Africa, evicting squatters requires landlords to follow the legal framework set out in the Prevention of Illegal Eviction from and Unlawful Occupation of Land Act (PIE Act). The process includes the following steps:

1. Obtain a court order

Landlords must apply to the court for an eviction order. They cannot legally remove squatters without this.

2. Prove unlawful occupation

Landlords need to demonstrate that the squatters are occupying the property unlawfully and have no legal right to remain.

3. Provide notice

The court issues a notice to the squatters, giving them a chance to oppose the eviction within a specified time frame.

4. Court hearing

The court will assess whether the eviction is just and equitable, taking into consideration the squatters' personal circumstances and vulnerability.

5. Sheriff enforcement

If the court grants the eviction order, the sheriff will enforce it and remove the squatters if they do not leave voluntarily.

It is essential for landlords to follow the legal procedures to avoid any legal repercussions and ensure the eviction is done lawfully.

How to deal with a disappearing tenant

• Attempt Contact: Make multiple attempts to reach the tenant via phone, email, and written communication. Document all efforts for legal records.
• Issue a Breach Notice: If the tenant is unreachable and rent is overdue, serve a breach of contract notice. This informs the tenant of their default and gives them time to respond or settle the issue.
• Check for Abandonment: If the tenant has vacated the property without notice, inspect the property for signs of abandonment and record any findings.
• Follow Legal Eviction Process: Apply for an eviction order under the Prevention of Illegal Eviction from and Unlawful Occupation of Land Act (PIE Act). Ensure the eviction is handled through the courts to avoid legal penalties.
• Avoid Self-Help Eviction: Never resort to illegal measures like changing locks or removing belongings without a court order, as this could lead to legal action against you.

Even if a tenant has disappeared, landlords in South Africa must follow the formal eviction process to legally regain possession of their property. This ensures legal protection, prevents unlawful eviction claims, officially terminates the lease, and allows landlords to claim unpaid rent.