Rent Increases Subject to Conditions

EmailEmail Print Share

22 Jan 2013

South African tenants in rented properties often have the idea that no rent increases can be allowed on a 12-month lease.

Some landlords, says Albutt, tend to think that any increase in rates, taxes or leases entitles them to pass these extra charges onto their tenants. This, however, is only legal if it has been stated in the original lease signed by both parties at the outset and can only become applicable during the second calendar year of a lease exceeding 12 months. This cannot be made applicable to leases on terms less than 12 months.

This, says Wayne Albutt, National Manager of Rawson Rentals, is substantially correct - but if landlords in a high demand area believe that more frequent rent increases should be allowed, they can arrange to have shorter leases, for example, six months and at the end of this period the rent can be renegotiated. Often an arrangement of this kind will suit both the landlord and the tenant.

Some landlords, says Albutt, tend to think that any increase in rates, taxes or leases entitles them to pass these extra charges onto their tenants. This, however, is only legal if it has been stated in the original lease signed by both parties at the outset and can only become applicable during the second calendar year of a lease exceeding 12 months. This cannot be made applicable to leases on terms less than 12 months.

When a lease expires, both the landlord and the tenant sometimes opt to renew it on a month-to-month basis. In these conditions, says Albutt, the landlord is entitled to increase the rent at the end of every month if he so wishes, as long as he gives applicable notice (normally one month). It is for this reason that it is not really advisable for a tenant to renew a lease on such a short-term basis.

“The principle at work here, is that once a lease has expired, totally new terms and conditions can be drawn up.”

Right now, says Albutt, the national average in rental increases is only 5% but this figure is misleading because it reflects, inclusively, the low demand for rentals in sparsely populated outlying areas such as country towns. In high demand areas, rent increases now being regularly achieved are around, and sometimes exceeding 10%, with the result that the buy-to-let investor market in this segment is improving rapidly. 

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