Landlords not allowed to intimidate non-paying tenants
More tenants are defaulting on their rental payments, but landlords are not permitted to cut their water or electricity supplies - nor are they allowed to change the locks or intimidate them in other ways.
If they do, it will count against them if the case goes to court.
While it can be a lengthy process to evict tenants who fail to pay their rent, there are procedures in place to make sure that both tenants' and landlords' rights are protected.
Adrian Goslett, regional director and chief executive of RE/MAX of Southern Africa, warns that it is crucial to abide by the contractual agreements and, if not, to then proceed with the required legal procedures stipulated in this regard.
"It is only when people deviate from this that issues start to occur."
Tenants are protected by two pieces of legislation - the Prevention of Illegal Eviction from Unlawful Occupation of Land Act, No. 19 of 1998 (PIE Act), and the Rental Housing Act of 1999 (RHAct). The first, he explains, sets out the process for evicting tenants and the second makes it a criminal offence for a landlord to simply cut the supply of electricity or water, change the locks, confiscate tenants' belongings, or stop a tenant from having access to the property.
"It is vital to always play by the rules. While you might think you can get a non-paying tenant out quicker if you change the locks or defer to other intimidation tactics, the truth is that this will most likely only provide the tenant with ammunition to use against you in the court proceedings. This will only drag things out further and cause more unnecessary complications and delays."
However, while the odd late payment due to a bank or financial system-related problem may be forgivable, a landlord cannot be so lenient if their tenant gets into the habit of paying their rent late. When the monthly payment date forms part of the rental agreement - which must also comply with the Consumer Protection Act - and a tenant doesn't pay on time, they are technically in breach of contract.
"Legally, this means that a landlord should send the tenant a formal letter explaining that they have 20 business days to make the payment, and if they don't pay their rent in that time, their lease will be cancelled."
If the tenant fails to pay what is due by the stipulated time-frame, Goslett says the landlord can legally terminate the lease and ask them to leave. If the tenant refuses, the landlord can then take out a court order to evict the tenant for breach of contract.
"This process can take up to six months, during which your tenant can stay in your property and will probably still not pay rent. Once the eviction is granted, the tenant is usually given at least another 14 days to find new accommodation before the eviction order is executed."
Because the eviction process can be so lengthy, he suggests taking steps as soon as possible to prevent too great a loss of income.
"The longer you take to act on a late or missed payment, the longer it will be before you can legally evict a tenant who continues to miss payments."
TPN's Residential Monitor Report for the first three months of 2023 shows that the tenants in good standing have declined slightly for three consecutive quarters as economic challenges continue to filter into households. TPN's Squat Index, defined as the number of tenants who on a monthly basis fall into a category of non-payment, has also seen an increase in the last two quarters.
Waldo Marcus, industry principal at TPN Credit Bureau, says tenants classified as squatting pose a severe risk to the ability of landlords to collect and recover rental due. Landlords, therefore, need to act proactively and utilise the various legal tools available to them to collect the outstanding rental.
He also advises landlords to carefully consider any rent increases as consumers are under extreme and ever-increasing pressure.
"Landlords need to take advantage of the current market strength but bear in mind that there is an upward trend in the number of tenants classified as squatting. They, therefore, need to ensure that adequate tenant risk monitoring is implemented to mitigate the risk of an increase in defaulting tenants."
15 Aug 2023
Author IOL Business