Handling and Refunding Rental Deposits

EmailEmail Print Share

26 Nov 2012

All landlords are entitled to take a deposit as security from their tenant, and from one to two months’ rent as a deposit is a good amount.  

The importance of an incoming and outgoing inspection is imperative to ensure a record of the state of the property before the new tenant moved in and after he moved out.

This, advises Michael Bauer, general manager of property management company IHFM, ensures that if the tenants do not keep the property in the condition in which it was received or fail to pay, the landlord will have funds from which to deduct the repair or cleaning costs.  

On the other hand, the tenant should, if they want to protect their deposit, keep the property in the state in which it was received, apart for normal wear and tear.  

The interest accrued on the deposit held must be added to the deposit refund paid to the tenant at the end of the lease.  

A landlord can claim for things in or on the property that are damaged by tenants or their guests; for cleaning expenses, for example, if the carpets were clean when the tenant moved in but on moving out there are pet or beverage stains on the carpets.  

The importance of an incoming and outgoing inspection is imperative to ensure a record of the state of the property before the new tenant moved in and after he moved out. 

Landlords can deduct money from the deposit refund if it is found that there is an amount outstanding on the water bill or other services not paid for. If items from the house have gone missing, such as door handles, access cards, or keys, the tenant is responsible for the cost of replacing these. Obviously, if there is still unpaid rent, this, too, can be deducted from the deposit. 

It is very important, says Bauer, that before a tenant moves into the unit being let out that a condition report is completed. Ideally the landlord (or his agent) and the tenant should walk through the property together noting items that are not in “perfect” order or things that need to be replaced before the keys are handed over.  

"If possible, take photos of the rooms, so that you have proof of the condition of the rooms and attach these photos to the lease agreement, as this will help if there are disagreements later." 

Bauer advises landlords to also allow the tenant three days to remedy any damages before commissioning any repairs and to always obtain more than one quote.  

Similar Articles

Disputes between landlords and tenants are common,...

Are you renting but not sure what your rights are? There...

Overpricing a rental can result in the property being...

View all articles

Top Articles

Whether you’d like to spend time on the glorious coast or...

St Francis Bay in the Eastern Cape is the ideal weekend or...

Overpricing your property usually results in it being sold...

View all articles
Top Articles
12 Feb 2016
Whether you’d like to spend time on the glorious coast or go further inl...
12 Feb 2016
St Francis Bay in the Eastern Cape is the ideal weekend or holiday escap...
12 Feb 2016
At USD$217 trillion, real estate is the pre-eminent asset class globally...
12 Feb 2016
Former Protea cricketer and world-renowned commentator, Pat Symcox, has ...
12 Feb 2016
Situated in Johannesburg North, Craighall and Craighall Park are attract...
Newsletter
Get the latest property news.
Select your options:
Loading

Your browser is out of date!

It looks like you are using an outdated version of Internet Explorer.

If you are using Internet Explorer 8 or higher, please verify that your Internet Explorer compatibility view settings are not enabled.

For the best browsing experience, update to the latest Version of Internet Explorer or try out Google Chrome or Mozilla Firefox.


Please contact our Property24 Support Team for further assistance. Tel. +27 (0)861 111 724