Buy-to-rent property, although slow due to the economic downturn, has lost none of its appeal for investors. But those who go this route have to familiarise themselves with a body of legislation that has grown up to protect both tenants and landlords.
Among these laws are the Prevention of Illegal Eviction (PIE) and Unlawful Occupation of Land Acts, and the clause that is causing the most difficulty for landlords says that, although it is acceptable to apply to the courts for the eviction of a tenant who is in arrears on rent payments, the court has to be satisfied that the evicted tenant has been offered an “equable solution” – which usually means that the landlord must be able to show that there is other similarly-priced accommodation available nearby. If this is not the case, the landlord may well be called on to carry the financial loss while the tenant remains in the unit.
Recently, the owner of a small block of apartments in Yeoville decided that the time had come to renovate, upgrade and improve his rentals. He gave the tenants three months’ verbal notice – but neglected to follow this up in writing. However, the tenants refused to leave and took their case to an NGO. The landlord was granted a High Court order but, when the tenants appealed against this in terms of the PIE Act, the judge ruled in their favour basing his decision on the fact that the tenants had nowhere else to go.
This case shows that a) it is essential to have all legal matters relating to property in writing, and (\b) if a lease is to be terminated against a tenant’s wishes, the landlord has to be able to prove that he has presented the tenant with “appropriate” rental alternatives and has assisted the tenant in applying for these.
Compiled in association with Lanice Steward, MD of Anne Porter Knight Frank