Preventing Rental Agreement Problems - 09-09-08

September 9 - It is not uncommon for property agents to suddenly find themselves expanding their services to include rental divisions as the landscape of South Africa's property market changes. While in the past most of the duties expected by agents involved the buying and selling of homes, today more and more South Africans are entering into the rental property market.

There are many reasons for the rental boom. For one, tough home loan laws mean that less people are able to afford to their own houses just yet and are opting to rent until they can afford to put down the higher deposits required by banks these days. In addition, many people who are unable to keep up with their monthly mortgage repayments are choosing to move into smaller rental properties and rent out their bigger homes.

While some agencies are prepared for this kind of business, many are quite inexperienced when it comes to sound rental agreements, and it is imperative that South African homeowners realize that they need to check out the credentials of the agency before they enter into any type of rental property agreement.

There are several issues that come up when forming an agreement with a potential agent who will handle the homeowners rental services. The first has to do with payment. Experts generally agree that payment, or commission, should be commensurate with the agent's duties and services and the most important aspect of this point is that the amount should be clearly stipulated in the property owner-agent agreement.

The Chief Executive Officer of Homenet, Martin Schultheiss had this advice to homeowners considering entering into rental agreements with agents: "Issues that should be addressed include services such as advertising the property, collecting rent, checking potential tenants' credit histories, managing routine maintenance work and regular inspection of the property."

"In cases where properties are leased fully or partially furnished," he added, "the agreement should also state whether or not the agent is expected to take an inventory when tenants move in or out."