The problem comes when landlords don’t put in any extra money to revamp the property
If you are an average citizen, earning an average income but looking for an investment to give you a little more ROI than your typical investment policy, investing in property is a far more appealing option. If you have a good credit record and are able to get a bond without too many hassles, it may seem like a fairly easy process, but the problem comes when independent landlords don’t put in any extra money to revamp the property, and they even possibly expect a tenants deposit to cover all the costs of repairs or damages, if there are any. Yet even in an ideal world this would not be so.
According to the Rental House Act, landlords will need to ensure the property is in a livable condition prior to a tenant moving in and will need to repair any defects or damages. This means that the cost of repairs will be over and above the monthly bond repayments and landlords are unable to use a tenant’s deposit to pay for such repairs or damages. A landlord is required to invest a tenants deposit in an interest-bearing account as stated in the Rental Housing Act and the deposit is not to be touched. Therefore, it is essential that a landlord has enough capital to fix up any defects or damages prior to a tenant taking up occupation.
Other factors to consider before investing in property, is what happens when a tenant is unable to pay rent for a month or is simply late in paying? Do you have enough money to cover the costs of your bond payments until the tenant eventually pays rent or will there be repercussions from the bank for not paying on time? For a landlord who owns one property, a tenant who does not pay rent for a month can be more damaging than for a landlord who owns and rents out multiple properties, as the risk is not spread out amongst the multiple properties.
Rental insurance or residential property letting tools
The solution to this is rental insurance or residential property letting tools that alleviate the stress associated with renting. If you are a business owner and simply don’t have the time to run after a delinquent tenant, one who is not paying rent and needs to be evicted, residential property letting tools will safeguard you in this instance. The eviction process alone takes up time and a copious amount of money, which a landlord with one property may not have stashed away. In the interim, every month the tenant is left to occupy the property the landlord loses out on rental.
Residential property letting tools such as Rentshield protects landlords against non-paying tenants because when a tenant doesn’t pay rent for a month, Rentshield will pay the rent to the landlord on behalf of the tenant, within 48 hours of a claim lodged and at no cost to them. The full scope of the eviction process is taken care of in compliance with the Consumer Protection Act, saving the landlord time and money as legal fees of up to R50,000 are also covered, at no cost. The premium is included into the monthly rental of the tenant, while offering the tenant a zero deposit lease. The independent landlord receives full protection and surety that their property is well taken care of.