Residential lease agreement

A lease is the only document either side looks at when something goes wrong, and by then it is too late to add anything. This one runs to nineteen clauses, and every one exists because somebody once argued about it. Here is what each does, which carry money, and which are worth negotiating before anybody signs.

What this document does and when to use it

This is a written lease for an ordinary residential letting: a house, a flat, a townhouse, a cottage or a room in a shared property. It records the rent, the escalation, the deposit, the inspections, who fixes what, what happens on breach, and how notices are given.

Use it when you are letting or renting a home and want the terms recorded properly. Use it even where you know the other party. Especially then, because those are the arrangements that end worst.

Do not use it for a commercial or industrial letting, for a short-stay holiday booking, or for a lease that runs beyond the ordinary. A long lease over immovable property and a lease with an option to purchase both raise issues this form does not cover.

Two Acts sit behind it and neither can be contracted out of. The Rental Housing Act 50 of 1999 requires the lease to be in writing if either party asks, and governs deposits, inspections and the parties' basic duties. The Consumer Protection Act 68 of 2008 applies to most residential leases where the landlord lets in the ordinary course of business, and gives the tenant rights this lease cannot take away. Clause 18.5 says so expressly, which is not decoration. It is what saves the rest of the lease when one term turns out to be unenforceable.

Before you start: get these facts straight

Full legal names and numbers for both parties. Identity number for an individual, registration number for a company or close corporation. A trading name is not a legal person, and where the landlord is a trust, the trustees contract.

Exactly what is being let. Not just the street address. The bedrooms and bathrooms, the garage, the parking bay number, whether the garden and store room are included.

Every item handed over, with quantities. Two front door keys, one gate remote, one access tag, the stove, the fitted blinds. Clause 1.3 is the list you check against on the last day.

The money. Monthly rent, the pro rata figure if the lease starts mid-month, the deposit, the escalation percentage and the escalation date.

Fixed term or month to month, and if fixed, the start and end dates. Who pays which utility, and whether any charge is recovered through the landlord.

The inspection. Book it for the day of handover before anything is signed, and make sure both parties can attend.

Walking through it, clause by clause

Clause 1 describes the property and, in 1.3, lists what is supplied with it. Landlords under-complete this clause more than any other. The remotes and access tags you do not list are the ones you cannot charge for later.

Clause 2 controls who lives there. It names the occupants and requires written consent, "which will not be unreasonably withheld", before anyone else moves in. That qualification is worth keeping. A bare veto in a home is the kind of term the Consumer Protection Act 68 of 2008 treats badly.

Clause 3 sets the period. Delete the option you are not using. Clause 3.3 obliges the landlord to give written notice before a fixed term expires and to say on what terms a renewal would be offered. Clause 3.4 says what happens if the tenant simply stays: the lease continues month to month on the same terms. Clause 3.5 records the tenant's right to cancel a fixed term on 20 business days written notice against a reasonable cancellation penalty, and obliges the landlord to take reasonable steps to re-let. That last obligation is what keeps a penalty honest.

Clause 4 is the rent. Amount, due day, first payment, pro rata, banking details, and the rule that payment happens when funds reflect. Clause 4.6 allows interest on arrears at a rate you fill in, "subject to any maximum rate permitted by law". Leave that qualifier in.

Clause 5 is the escalation. A percentage, an anniversary or a fixed date, written confirmation at least a month before it bites, and no other increases during a fixed term. Tenants should read this one hardest, because a percentage that looks small compounds over a three-year lease. Read can my landlord increase rent mid-lease.

Clause 6 is the deposit, and it is the most litigated clause in the document. It must be held in an interest-bearing account with a financial institution and the interest belongs to the tenant. It is security, not rent, and the tenant may not live it out. Deductions are limited to amounts actually owed and must be supported by a written breakdown with invoices, quotations and receipts. Fair wear and tear can never be deducted.

Clause 7 splits the utilities and, in 7.4, stops a landlord marking up a municipal account. Fill in the administration fee or write "nil". A blank there is an invitation.

Clause 8 is the inspections. Joint incoming inspection before occupation, recorded, signed and attached as Annexure A. Joint outgoing inspection in the three days before the lease ends. Clause 8.3 is the tenant's protection: a landlord who does not inspect jointly after the tenant made itself available is treated as accepting the property in good condition. Clause 8.4 protects the landlord where the tenant does not turn up.

Clauses 9, 10 and 11 cover use of the property, subletting and pets. Each is negotiable. A tenant who works from home should say so under 9.1 rather than discover later that it needed consent.

Clause 12 divides maintenance. The landlord keeps the property habitable, including the structure, plumbing behind the walls, the electrical installation, the geyser and fair wear and tear. The tenant handles day-to-day upkeep and its own damage. Clause 12.3 requires defects to be reported in writing within a stated number of days, and clause 12.4 lets the tenant arrange an urgent health-or-safety repair and recover the cost where the landlord cannot be reached. Read who pays for repairs in a rental property.

Clause 13 is access, and it is short because the rule is simple. The property is the tenant's home. The landlord gives written notice before entering, and may enter without notice only in a genuine emergency. Clause 13.4 records that the landlord may not lock the tenant out, remove doors or windows, or cut off water or electricity. See can a landlord enter my home without permission.

Clause 14 is breach. Twenty business days written notice to remedy, then cancellation and damages, with the same right in reverse for the tenant. Clause 14.4 surprises landlords: cancellation does not entitle you to evict. Removal requires a court order under the Prevention of Illegal Eviction from and Unlawful Occupation of Land Act 19 of 1998 (the PIE Act).

Clauses 15 to 19 cover handover, house rules, notices and domicilium, the general terms and the annexures. Clause 17.1 is the domicilium, where legal process may be served, so it must be a physical address in South Africa. Clause 15.3 obliges the tenant to hand over a forwarding address and banking details, which is what makes the deposit refund possible.

A worked example

This example is illustrative only and the facts are made up.

Mrs Naidoo lets a two-bedroom garden cottage. In clause 1.3 she lists two front door keys, one gate remote, one postbox key, the stove and the fitted geyser. Under clause 1.2 she includes the garden and one parking bay, and excludes the main house store room.

She uses the fixed-term option in clause 3.1 for twelve months. Rent is R7 400, due on the first, with a pro rata first payment because occupation starts on the 15th. Escalation in clause 5.1 is 7 percent on the anniversary. The deposit is R7 400, which she pays into a separate interest-bearing account on the day she receives it, keeping the statements.

Her tenant asks for two changes. He works from home as a bookkeeper and wants clause 9.1 amended to permit quiet professional work with no client visits. He also asks that clause 12.3 give five days to report defects rather than three. She agrees to both, the changes are made before signature, and both parties initial the amended pages.

On handover day they walk the cottage together, complete Annexure A room by room, photograph a chipped basin and a stained carpet edge, record the meter readings, and both sign and date it. Twelve months later, that annexure is why there is no argument.

The clauses people get wrong

Clause 6.2, the deposit account. Landlords keep the deposit in the household current account and spend it. When the lease ends there is nothing to refund and no statement to produce. The cost is the deposit plus the interest, plus whatever further order the Tribunal makes.

Clause 8, the inspections. Skipping the incoming inspection is the most expensive shortcut in residential letting. Without Annexure A nobody can prove what the property looked like on day one, and what is not recorded cannot be deducted. Skipping the outgoing inspection costs the landlord the right to deduct at all.

Clause 5, the escalation. Leaving the percentage blank, or writing a figure without the date it applies from. The cost is a year of arguing about whether an increase was agreed, and an increase that cannot be enforced during the fixed term.

Clause 14.4, self-help eviction. Changing the locks, removing the front door, or cutting the power to force a defaulting tenant out is unlawful, no matter how much rent is owing. Eviction always needs a court order. The cost is an urgent application against you, the tenant back in the property, and a costs order. Read can a landlord evict me without a court order and how to evict a tenant who is not paying rent.

Clause 7.4, recovered charges. A landlord who bills the tenant more than the municipality charged, without a stated administration fee, has an unfair practice complaint waiting at the Tribunal.

Clause 17, the domicilium. Using an email address or a post box. It must be a physical address in the Republic, because that is where legal process is served, and a defective domicilium can undo everything you try later.

Signing it and keeping proof

Print two full sets, including every annexure. Both parties initial every page and sign the last page, and two witnesses sign for each party. A residential lease does not strictly require witnesses, but a witness who can say "I watched them sign" ends a signature dispute in one sentence, and it costs nothing. Fill in the place and date of signature, because blank date lines are a gift to anyone who wants to argue about when the lease started.

Annexure A must be completed and signed on handover day, not from memory afterwards. Photograph every room, including inside cupboards, and the meter readings, then email the photographs to the other party the same day so there is a timestamp neither side controls. Annexure B is the inventory for a furnished letting and Annexure C the house rules. Attach them or delete the reference. A lease referring to annexures nobody can produce is weaker than one that never mentioned them.

Each party keeps a full signed set. Scan yours and store it where you will find it in two years. A lease nobody can produce later is worth nothing, and in a Tribunal hearing the party who brought the documents wins the points that turn on documents.

What happens if it goes wrong

The Rental Housing Tribunal in the province hears rental disputes for free. It takes complaints from landlords and tenants alike, and can rule on deposits, deductions, maintenance, utility overcharging and unfair practices. You do not need an attorney and there is no fee. Its ruling is enforceable in the same way as a magistrate court order.

The Small Claims Court is the alternative for a money claim under the limit. It costs nothing to bring, no lawyers appear on either side, and you start at the clerk of the court. Check where your claim falls on the small claims court calculator. For deposit timing use the deposit refund calculator, and for an early cancellation the fixed-term contract cancellation calculator.

Eviction is the exception. It goes to the magistrate court under the PIE Act, it needs a court order, and the court must be satisfied the eviction is just and equitable. Read how does the PIE Act protect tenants.

Legal Aid South Africa on 0800 110 110 applies a means test, and university law clinics assist in most major centres.

LawMatch is not a law firm and this is general information, not legal advice about your situation.

Frequently asked questions

Does the lease have to be in writing?

The Rental Housing Act 50 of 1999 requires a written lease if either party asks for one. In practice, always write it down. An oral lease is valid but nobody can prove what was agreed, and the deposit and inspection obligations are far harder to enforce without a document.

Can the landlord keep the deposit in a normal bank account?

No. It must be held in an interest-bearing account with a financial institution, and the interest belongs to the tenant, who may ask for written proof of it under clause 6.2.

What if the tenant leaves the fixed term early?

Clause 3.5 applies. The tenant cancels on 20 business days written notice, the landlord may charge a reasonable cancellation penalty, and must take reasonable steps to re-let. A penalty is the genuine re-letting cost and vacancy period, not the balance of the rent.

Can the landlord increase the rent during the fixed term?

Only in accordance with clause 5. Outside that clause the rent during a fixed term is what the lease says it is.

Who pays for a burst geyser?

The landlord, under clause 12.1, as part of keeping the property habitable and in good repair. If the tenant caused the damage, clause 12.2 applies instead. Clause 12.4 lets the tenant arrange an urgent repair and recover the reasonable cost against proof where the landlord cannot be reached.